Thirteen companies in the index are due to report results today, including Yum! Brands Inc. Of the 259 companies that have released earnings so far in the reporting season, 73 percent topped analysts’ profit projections, according to data compiled by Bloomberg.
Stocks in the world’s developed nations posted the best start to a year in two decades, a sign the global economy is poised to accelerate after contractions in Japan, the U.S. and Europe, if history is a guide.
The MSCI World Index of stocks in 24 markets rose 5 percent in January, the most since 1994, as individual investors pumped record deposits into mutual funds, U.S. profits increased for an 11th quarter, central banks kept interest rates at record lows and growth from Europe to China improved. The last two times stocks gained this much in January, world gross domestic product expanded at least three times the 2.4 percent that economists forecast for 2013, according to data compiled by Bloomberg.
While market strategists say that equities have already recorded most of this year’s gains, bears who predicted declines at this point in 2012 only to see the S&P 500 close up 13 percent, are being overlooked. Bulls say the rally is just getting started after U.S. investor sentiment rose to a two-year high and billionaire Warren Buffett offered to buy the parent of the New York Stock Exchange.
The Stoxx 600 fell the most since October and trimmed its 2013 advance to 1.5 percent.
Spain’s IBEX 35 Index tumbled 3.8 percent, the most since September, and Italy’s FTSE MIB Index plunged 4.5 percent in its biggest slide since August. Banco Santander SA, Spain’s largest bank, sank 5.7 percent as Rajoy denied corruption allegations. UniCredit SpA, the biggest lender in Italy, sank 8.3 percent in the largest drop since June. Julius Baer Group Ltd. fell 3.1 percent after the wealth manager reported declining revenue margins.