US stock rallied Monday morning following positive fourth quarter earnings from computer services giant IBM - a Dow component - and the prospect of rate cuts.
The Dow Jones Industrial Average was up 108 points, or 0.85%, at 12714.
IBM today announced fourth-quarter 2007 diluted earnings of $2.80 per share from continuing operations, an increase of 24 percent, compared with diluted earnings of $2.26 per share in the fourth quarter of 2006. The company also reported fourth-quarter revenue of $28.9 billion, an increase of 10 percent as reported, including 6 points of currency benefit, compared with the fourth quarter of 2006.
IBM's share price rose 6.05%.
The Nasdaq Composite Index was up 0.93%, or 23 points, at 2463. The Standard & Poor's 500 Index, off to its worst start for a year since 1982, added 8 points, or 0.58%, to 1,409.
The Fed's rate-setting Federal Open Market Committee is due to meet on Jan 30/31 and the market expects a cutin in the federal funds rate to 3.75%.
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European stocks rose for the first time in four days, and Europe's biggest software company SAP reported that after a preliminary review of its 2007 fourth quarter results, it expects fourth quarter software and software related service revenues to be approximately €2.48 billion (2006: €2.20 billion), representing an increase of around 13% (around 17% at constant currencies) compared to the fourth quarter of 2006. Full-year 2007 software and software related service revenues are expected to be approximately €7.44 billion (2006: €6.61 billion), representing an increase of around 13% (around 17% at constant currencies) compared to the full-year 2006. The Company’s full-year software and software related service revenue growth at constant currencies exceeded its previously published outlook.
SAP share price rose 2.71%.
The Dow Jones Stoxx 600 rose 0.42%
National benchmarks rose in 16 of the 18 western European markets. The U.K.'s FTSE 100 gained 0.28%; France's CAC 40 climbed 0.60% and Germany's DAX advanced 0.25%.
In Dublin, the ISEQ Index rose 1.01%
Bloomberg reports that the Stoxx 600 is valued at 12 times profit, the lowest since at least January 2002.
West African Diamonds plc, the Irish owned AIM listed diamond and precious metals explorer and developer (AIM: WAD), announced on Monday that gold and diamond production is underway at its Koidu mine in Sierra Leone.
The first gold pour has already taken place at the Plant 11 Tailings Mine in Koidu and in excess of 3,100 diamonds (198 carats) have been recovered from the 16,100 tonnes of material treated to date. Gold and diamond marketing contracts are in place and the first sales will occur in Q1 2008.
James Campbell, Deputy Chairman, said “A year ago when West African Diamonds listed in London this project had yet to reach the detailed designed stage. It is a major achievement and a tribute to our staff in Sierra Leone that we have been able to design, build and commission a mine in West Africa in one year. Plant 11 which should produce revenue for a number of years provides a sound foundation on which to build our other mines in Sierra Leone and Guinea."
The plant has been commissioned at its targeted capacity of 150 tonnes per hour and is currently operating on an extended day shift basis. Overall output for the 7M tonne deposit is expected to be approximately 0.4g/tonne gold worth $9 a tonne of ore and diamonds worth $3 a tonne of ore. Expected mining and treatment costs are $3 per tonne.
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Crude oil for February delivery is trading on the New York Mercantile Exchange (Nymex) at $94.01 a barrel up $1.32 from Friday's close.
The euro is trading at $1.4876 and at £0.7596.
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