Facebook's 63% profit surge boosts stocks on Wall Street

Facebook’s 63% increase in earnings put a rocket under technology stocks on Wall Street, pushing the Dow Jones Industrial up 239.47 points, or 1.00%, to 24,323.37.

Facebook was backed up by a higher-than-expected performance from Advanced Micro Devices and another strong round of first-quarter earnings.

The tech-heavy Nasdaq Composite jumped 1.6% to 7118.68 while the S&P 500 added 1.0%. to 2667.13.

Facebook chief operating officer Sheryl Sandberg said the company hadn’t seen a “meaningful trend” of advertisers leaving after its data-privacy scandal.

The shares jumped 10% – their best day in more than two years – while AMD rose 13%. That helped boost the S&P 500’s technology sector up 2.4% after a six-session losing streak.

“The earnings season in general … it’s really been outstanding,” says Jacob Johnston, vice president at Advisors Asset Management.

A recent lurch higher in 10-year US Treasury yields has spurred stock volatility in recent months but Mr.Johnston says he still thinks yields are far from being a real threat to strong equity returns.

Bond yields fall
The benchmark 10-year bond yield fell to 2.994% from 3.026% on Wednesday. The yield rose above 3% earlier this week for the first time since early 2014.

“Of the 155 S&P 500 companies that have reported thus far, 81% have beaten expectations,” says Fahad Kamal, senior markets strategist Kleinwort Hambros. “Still, rising bond yields keep animal spirits at bay.”

Chipotle Mexican Grill shares rose 24.5% and were the biggest gainers in the S&P 500. This followed a stronger-than-expected profit and sales for the first quarter, on track.

In Europe, the Stoxx Europe 600 edged up 0.9%.

The European Central Bank’s governing council, as expected, left interest rates and its bond-buying programme unchanged.

“The [ECB] governing council may want to wait for more economic data and the June economic projections before taking a clearer stance on the direction of monetary policy going forward,” analysts at ABN Amro said in a research note.

France’s CAC40 rose 0.7%, Germany’s DAX gained 0.6% and the UK’s FTSE 100 advanced 0.6%.