Futures markets indicate a fairly strong open to North American stock markets today following on strong gains posted in Asia and Europe.
In the commodity front oil and gold prices are modestly higher today, although three-month future base metal prices were down sharply with aluminum falling 1.8 per cent, copper down 2 per cent, lead 3.4 per cent and zinc 3.6 per cent, according to Bloomberg.
Investors around the world seemed to take confidence in U.S. President Obama's State of the Union address, although no new initiatives were presented as far as spending on infrastructure or stimulus spending. He also seemed to soft-pedal his criticism of the banks.
"We support the President's rather less-strident tone taken last evening regarding the nation's banks and financial institutions," said Dennis Gartman, author of the Gartman Letter. "On balance, however, the hard issues were lacking in the speech; hard details were non-existent, and hard questions were avoided."
There are also reports that Federal Reserve Chairman Ben Bernanke's bid for a second term bid will be voted on by the U.S. Senate today and speculation is that he have the required number of votes for approval.
"President Obama's bank reform proposals have overshadowed good news on the earnings front," said Carmine Grigoli, chief investment strategist with Mizuho Securities USA Inc. "Based on data from [the companies representing] 30 per cent [of the S&P 500's total]capitalization that have already reported, fourth quarter earnings are exceeding analysts' projections by about 12 per cent, excluding financials."
A large number of companies in the technology and capital goods sectors also reported rising sales and growing order backlogs, he said.
"What makes this reporting season profoundly different from most past cycles is that companies are beating elevated expectations and are guiding forecasts higher," Mr. Grigoli said.
The noisy U.S. durable goods orders released today failed to meet economist forecasts, although the data indicates capital spending continues to rise.