US stocks rally on strong earnings

NEW YORK: Wall Street shares closed higher Friday, buoyed by better than expected US earnings, solid German business confidence data and a US$430 billion deal to fight Europe's debt crisis.

The Dow Jones Industrial Average climbed 65.16 points or 0.5 per cent to 13,029.26 by the close of trade.

The S&P 500 was up 1.6 points, or 0.1 per cent to 1,378.53 points.

However, the Nasdaq fell 7.11 points (0.2 per cent) to 3,000.45 as Apple shares sank 2.5 per cent.

The resilience of Europe's biggest economy to the debt crisis was underscored Friday as German business confidence beat expectations to rise for the sixth month in a row in April.

The Ifo Institute's closely watched business climate index unexpectedly edged fractionally higher to 109.9 points in April from 109.8 points in March, defying analysts' expectations for a slight decline.

"The German economy is proving resilient," said Ifo president Hans-Werner Sinn.

Meanwhile, US earnings also helped sentiment.

"Another batch of better-than-expected earnings from several widely held companies has also bolstered confidence in stocks," said Briefing.com analysts.

GE said Friday its profit fell 10 percent in the first quarter, but the company managed to beat Wall Street expectations.

GE, a diversified group with energy, industrial and finance operations, reported US$3.03 billion profit for the first three months of 2011, compared with US$3.36 billion in the year-ago period.

Earnings per share of 34 cents were one cent higher than the average analyst estimate.

GE's shares were up around 1.2 per cent.

McDonald's shares were up just under one per cent after it reported an increase in earnings.

Wall Street also got a boost from news that G20 countries had pitched in to create a US$430 billion IMF fund to fight Europe's debt crisis. -- AFP