Overnight Markets: US stocks advance on strong Citigroup earnings

Wall Street rose to a five-month high on Monday after stronger-than-expected profit from Citigroup helped financial shares and an unexpected decline in industrial production added to signs the Federal Reserve will help fuel the recovery.

The Dow Jones industrial average rose 81 points, or 0.73%, at 11,144. The Standard & Poor's 500 Index gained nine points, or 0.72%, at 1,185. The Nasdaq Composite Index added 12 points, or 0.48%, at 2,481.

Citigroup climbed 5.6% to $4.17 after it unveiled its third consecutive quarterly profit amounting to 7 cents a share, compared with a loss of 27 cents a share in the same period a year earlier. The bank said that it is scrutinising the home loans it bundled into bonds and sold to investors.

The KBW Bank index surged 3%, recovering some of the losses banks had in the last few days. Bank of America, which is scheduled to report earnings on Tuesday, rose 3% to $12.40. Wells Fargo added 5.5% to $24.87 and Goldman Sachs gained 2% to $153.70.

Meanwhile, the need for more stimulus was highlighted by a Fed report showing production in the US unexpectedly dropped 0.2% in September, the first decline since the recession ended in June 2009.

In other corporate news, Apple Inc, which hit an all-time high during the regular session, skidded 5% after reporting gross margins and iPad shipments. IBM also declined 3.5% on sluggish sales of technology services.

Shares in Northeast Utilities fell 0.9% and NSTAR was off 0.6% after it was revealed that the former will acquire NSTAR in a $4.2 billion all-stock deal.

In current trading, Asian were trading higher on Tuesday after Citigroup unveiled better that estimated earnings report.

The MSCI Asia Pacific Index rose 0.2% to 130.66 as of 11:07 a.m. in Tokyo. Japan’s Nikkei 225 Stock Average gained 0.6%. Korea’s Kospi Index advanced 0.2%. Australia’s S&P/ASX 200 Index climbed 0.3%.