Market Commentary: Asian stocks briefly hit six-year high

US

The US equity market advanced following earnings reports from Intel Corp. and take-over news from Time Warner Inc. sending the Dow Jones Industrial Average to an all-time high.

Intel reported its earnings shortly after the close on July 15, and the results were impressive. Revenue came out at the mid-range of guidance at $13.8 billion and gross margins slightly beat guidance at 64.5%.

However, the key market mover was guidance that the company is aiming for a gross margin of 66% in the coming quarter. Intel also took the opportunity to announce a massive $20 billion buyback program.

Twenty-First Century Fox Inc. is willing to pay more than $75 billion for Time Warner Inc. Fox’s is thus willing to pay over $85 per share; Time Warner is currently trading at $83 following a 17% gain on the news. The deal is intended to bring together TV and Film companies together in order to gain negotiating power with cable operators.

Asia

Asian stocks were little changed albeit briefly reaching a six-year high early this morning. Mining companies climbed as iron-ore prices held neat their highest levels in recent weeks while TSM, the world’s largest contract maker of chips fell 4.6% after saying that it expects stiffer competition next year.

Sentiment has turned more upbeat about the prospects for Japan’s economy. In a poll thirty-seven percent said it was improving, up from 28 percent in April, when growth in the world’s third largest economy was hurt by a sales-tax increase.

Europe

European stock indices fell this morning as further sanctions were imposed on Russia over Ukraine. The US and European Union imposed the most aggressive sanctions to date on Russian businesses as Russia re-started mobilizing troops around the Ukrainian border.

Before the market opened SAP SE reported strong results even if operating profit trailed analysts’ estimates. SAP opened up 4.5%. Novartis also posted second-quarter profits that missed analyst expectations.

This article was issued by Calamatta Cuschieri, visit www.cc.com.mt  for more information.

The information, view and opinions provided in this article is being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. Calamatta Cuschieri & Co. Ltd has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing on this website.

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