Global shares rise on Apple, Bernanke's comments

Wed Apr 25, 2012 5:01pm EDT
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By Herbert Lash

NEW YORK (Reuters) - Global shares jumped on Wednesday after stellar earnings from Apple Inc bolstered optimism over corporate earnings and Federal Reserve Chairman Ben Bernanke said the central bank was prepared to do more to aid the U.S. economy if necessary.

The dollar slipped and U.S. stocks extended gains in late trade after Bernanke said the Fed "would not hesitate" to launch another round of bond purchases to drive borrowing costs lower, though he made no suggestion further support was in the works.

Bernanke's news conference following the Fed's latest policy meeting capped a see-saw session. Earlier, the Fed reiterated its expectation that interest rates would not rise until late 2014 at the earliest, a statement that briefly drove bond yields up and led gold to sell off before recovering.

The broad S&P 500 rose more than 1 percent and the Nasdaq climbed more than 2 percent in its biggest gain so far this year, lifted by Apple's results.

The Fed raised its forecasts for economic growth and core inflation, while lowering its expectations for the unemployment rate for 2012. The forecasts countered data earlier in the day on capital goods orders, which pointed to slower growth this quarter.

The euro recouped early losses to trade near session highs, rising 0.2 percent to $1.3223 in late New York trade.

"People looked at the FOMC statement and saw no mention of QE3. But in his press conference, Bernanke made it quite clear that additional asset purchases remain completely on the table. That may have been a revelation to some of the earlier sellers," said William O'Donnell, head of U.S. Treasury strategy for the Americas at RBS Securities in Stamford, Connecticut.

U.S. equity markets zoomed at the open on Apple's report that quarterly profit almost doubled from a year earlier after markets closed on Monday.   Continued...

A man takes a photo of displays showing market prices at the Tokyo Stock Exchange in Tokyo April 11, 2012. REUTERS/Toru Hanai