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Market Update

ECB 2-Month Plan Supports Global Rally, U.S. Stocks Struggle at Records

Author: Nichole Harper
Last Update: 1:19 PM ET May 19 2015

1:15 PM – Global markets jumped after the European Central Bank official suggested that the bank may accelerate its one trillion euro bond-buying program over the next two months. Weak same store sales from Wal-Mart offered another signal that consumers are saving lower fuel price windfall.

U.S. stocks traded sideways and market indexes rested after Dow Jones and S&P 500 closed at record highs in last session.

Stronger-than-expected housing data showed U.S. housing starts soared to a seven-year high in April and permits jumped.

Housing permits in April climbed 10.1% from the revised March rate but jumped 6.4% from a year ago month to 1,143,000.

Housing starts in April surged 20.2% to 1,135,000 from the revised March estimate, the Department of Commerce said.

On Wall Street, Tollbooth Strategy Index edged up 7 to 10,820.06.

S&P 500 index edged down 0.02 to 2,128.88 and the Nasdaq Composite Index fell 5.58 to 5,072.83.

Crude oil in New York slipped $1.91 to $57.52 a barrel and gold tumbled $20.20 to $1,207.40 an ounce.

U.S. Movers

The Home Depot Inc (HD), the home improvement retailer reported net sales in the first-quarter ending in April jumped 6.1% to $20.9 billion from a year ago period.

Comparable store sales in the quarter climbed 6.1% and comparable sales for U.S. stores soared 7.1%.

Net income in the quarter surged 14.3% to $1.6 billion or $1.21 per diluted share compared to $1.4 billion or $1 from the same quarter last year.

Wal-Mart Stores, Inc (WMT), the discount stores operator reported total revenues sales in the first-quarter ending in April slid 0.1% to $114.8 billion from a year ago period.

Total comparable store sales in the quarter increased 1%. Sam''s Club net sales declined 3% to $13.5 billion and international net sales declined 6.6% to $30.3 billion.

Net income in the quarter declined 6.9% to $3.3 billion or $1.03 per diluted share compared to $3.6 billion or $1.11 from the same quarter last year.

The retailer forecasted earnings per share for the second-quarter in the range of $1.06 to $1.18.

European Markets

European market indexes traded higher after an official from the central bank in the currency union said that the bank is planning to be more active in the early weeks of May and June.

Separately, a private survey indicated that German economic sentiment declined more than expected in May. The ZEW Index of Economic Sentiment fell to 41.9 from 53.3 in April.

German government’s statistics office said total number employed people increased 0.7% in the March quarter from a year ago quarter to 42.4 million. The increase in the employment count in December quarter was 0.9%.

In addition, auto sales in Europe increased for the twentieth month in a row in April, but the growth rate slowed down according to the latest data released by the European Automobile Manufacturers Association.

U.K. producer prices index for all manufactured products rose 0.1% from a year ago month in April, unchanged from March.

Between April and March output price fell 1.7% and stable since February, the Office for National Statistics reported.

In a separate report the department said annual inflation measured at consumer prices fell 0.1% in April for the first time in more than half a century and the index was flat compared to March and dropped 0.3% from January.

The euro zone trade surplus soared 45.3% to €23.4 billion in March from €16.1 billion a year ago month, according to the first estimate.

In the wider region of EU28, the trade surplus climbed three-fold to €10.7 billion in March with rest of the world from €3.6 billion a year ago month, the Statistical Office of the European Communities said.

The department said in a preliminary estimate the annual inflation rate in the euro area was flat in April compared to -0.1% March. In April 2014 the rate was 0.7%.

In London trading, FTSE 100 index gained 0.3% or 23.84 to 6,992.71 and in Frankfurt the DAX index climbed 1.7% or 200.20 to 11,794.48.

In Paris, CAC 40 index jumped 1.8% or 89.43 to 5,101.74.

Vodafone Group Plc dropped 3.3% to 226.46 pence after the U.K.-based mobile company reported revenues in the year ending in March soared 10.1% to £42.2 billion from £38.4 billion in a year ago period.

Net profit in the year tumbled 90.3% from a year ago to £5.8 billion compared to £59.3 billion and diluted earnings per share plunged 21.63 pence from 222.07 pence.

Vodafone said free cash flow in the quarter of about £1.1 billion and capital expenditure climbed 45.7% to £9.2 billion while net debt in the quarter of about £22.3 billion.

Asian Markets

Market indexes in Tokyo advanced for the third day in a row as corporate earnings stay ahead of expectations and higher payout ratios of dividend. Investors bid up stocks ahead of the release of March quarter economic growth data on Wednesday.

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Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc