US open: Google on M&A path


LONDON (ShareCast) - - Stocks bounce back ahead of Fed minutes
- Google (NasdaqGS: GOOG - news) on M&A path
- Shares of Tiffany move higher

Dow Jones Industrials: 0.79%
Nasdaq Composite: 0.64%
S&P 500: 0.60%

The main US stock market averages bounced back partially on Wednesday ahead of the release of the minutes of the Federal Open market Committee's last policy meeting and speeches from three Fed speakers, including Janet Yellen herself.

Last month the Fed decided to scale back another $10bn from monthly bond purchases, citing an improving economy and a pick-up in the jobs market. The central bank also said further tapering in measured steps was likely.

Charles Plosser, the President of the Federal Reserve bank of Philadelphia, on Tuesday night warned the current rate of tapering set forth by the Fed could be too slow if the US economy continues to recover as expected.

He said it could mean a rate hike would be necessary "sooner rather than later" as the US moved closer to its 2% inflation goal and as the labour market improved.

Plosser's counterpart in New York (Frankfurt: HX6.F - news) , William Dudley, said the Fed would raise rates only after "a considerable period of time" after the final asset purchase, which he anticipated would happen in the autumn.

In other US news, mortgage lending rose 0.9% in the week ended May 16th following a 3.6% increase a week earlier.

Google on M&A path

Of interest, Google surpassed Apple (NasdaqGS: AAPL - news) as the world's most valuable brand, reclaiming from Apple the top spot in the annual rankings for BrandZ Top's 100 Most Valuable Global Brand list.

In related news, on Tuesday night the Mountain View, California-based search engine giant disclosed that late last year it passed on a deal to acquire an unnamed foreign company in a transaction valued at up to $5bn.

In a letter which was originally sent to the US Securities and Exchange Commission in December Google said it would need between $20-$30bn worth of overseas profits to help fund the international acquisitions of companies and technology rights it has planned.

Shares of jewellery retailer Tiffany rocketed after it reported a rise in first quarter income that beat analysts' estimates.

Analog Devices (NasdaqGS: ADI - news) gained after the maker of semiconductors posted second quarter earnings that exceeded forecasts.

Noble Energy (NYSE: NBL - news) dropped as Woodside ended an agreement to buy a quarter of the Leviathan project off the coast of Israel for as much as $2.6bn after talk to complete the deal fell through.

Inuit declined after the maker of financial and tax-preparation software lowered its earnings forecast for the three months through July 31st.

Treasury yields edge higher

The yield on 10-year US Treasuries rose by three basis points to 2.54%.

Front month West Texas crude futures slipped 0.10% to the $102.51 per barrel mark on the NYMEX.


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