NEW YORK (AP) – U.S. stocks rose Tuesday after aluminum producer Alcoa issued an outlook that suggested improving prospects for the global economy.
The Dow Jones industrial average, the broader Standard & Poor's 500 index and the Nasdaq composite index all jumped close to or more than 1% in the first few minutes of trading. Late Monday, Alcoa CEO Klaus Kleinfeld predicted that global aluminum demand will increase 7% in 2012.
Fourth-quarter revenue for Alcoa (AA) topped expectations and the results gave investors hope for a strong earnings season in the U.S. They also are looking to a new round of talks in Berlin for progress in solving Europe's debt crisis. European markets are sharply higher.
Stock trend
Dow Jones industrial average, five trading days
On the negative side, luxury jeweler Tiffany & Co. (TIF) reported weak holiday sales growth in the U.S. and Europe, and shares dropped more 6.4% in early trading.
The U.S. economy has shown signs of strength recently, and investors are hoping that will boost corporate earnings results due to be announced in coming weeks. In particular, improvement in the U.S. labor market has raised the possibility of a recovery in American consumer spending, one of the main motors of global economic growth.
The European Central Bank said Tuesday that the amount of overnight deposits that the region's banks held with it rose to 481.9 billion euros, or $613 billion, on Monday, breaking the record 463.6 billion euros set only a day before.
The high deposits mean banks are keeping spare cash in a safe place even though they earn low interest. They also reflect large amounts of cash put into the banking system from ECB emergency loans of 489 billion euros taken up by more than 500 banks in late December.
Dutch electronics giant Royal Philips Electronics NV kicked off Europe's corporate earnings season by warning that its fourth-quarter profit was less than expected due to a weak European market that made it difficult to charge customers as much as it wanted to for light bulbs.
Overnight markets in Asia were marginally higher, thanks to improving economic data out of the U.S., said Cameron Peacock of IG Markets in Melbourne.
The optimism was tempered by news that China's import growth decelerated sharply in December in a new sign the world's second-largest economy is slowing.
Benchmark crude for February delivery rose $1.46 to $102.77 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 25 cents to settle at $101.31 in New York on Monday.
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