While you were sleeping: UPDATED Earnings, tech deal boost global shares

Better-than-expected earnings such as from Bank of America as well as a $US32 billion tech deal helped bolster equities on both sides of the Atlantic.

Shares of Bank of America rallied 3.3% after it reported better-than-expected quarterly results.

"Bank of America's second-quarter results, while noisy, reflected a number of items that surprised positively," Nomura analyst Steven Chubak told Reuters.

As low-interest rates weigh on earnings, the focus is on keeping costs in check.

"The question is, can we grow earnings without rates improving?" CEO Brian Moynihan said on a conference call, according to media reports. "We believe we surely can."

Wall Street moved to new record highs for major indexes. The Dow Jones Industrial Average closed 16.50 points, or 0.1%, higher at 18,533.05. The Nasdaq Composite Index gained 0.5% to 5055.78, while the Standard & Poor's 500 Index moved 0.2% higher to 2166.89.

"The focus for the market is on earnings, and more importantly guidance, focusing on the impact of the economy, elections, and how the dollar is influencing business conditions," Kevin Kelly, the chief investment officer at Recon Capital Partners in New York, told Bloomberg.

Chip deal boosts Nasdaq
The Nasdaq received a boost from acquisition news. Shares of UK-based ARM Holdings soared 40.9% in London after Japan's SoftBank agreed to buy the chip designer for $US32 billion. The deal is the biggest ever Japanese acquisition in Europe, according to Bloomberg.

Apple, one of ARM’s biggest customers, rose 1.1%. Apple has been the worst performer in the Dow Industrials since the blue chip index was last at record levels in May 2015.

Home Depot and DuPont also rose 1.1%, outweighing declines in Caterpillar and Merck.

US Treasurys fell, pushing yields on the 10-year note five basis points higher to 1.60%, amid renewed optimism about the US economy.

In Europe, the Stoxx 600 Index finished with an increase of 0.2% from the previous close, bolstered by the ARM Holdings deal. The UK's FTSE 100 index added 0.4%. Even so, France's CAC 40 index fell 0.3% while Germany's DAX index closed 0.04% weaker.

Investors shrugged off the unsuccessful attempt at a military coup in Turkey on Friday and are waiting for comments from European Central Bank President Mario Draghi following a policy meeting on Thursday about the outlook for the economy and additional stimulus.

"The fact that the coup has failed in Turkey is helping European stocks today, adding to optimism on expectations that the ECB might announce some further easing or call for governments to step up fiscal measures to prop up the economy this week," Pierre Mouton, who helps manage about $US9 billion at Notz, Stucki & Cie in Geneva, told Bloomberg.

In Turkey, the Borsa Istanbul 100 Index plunged 7.1%.

(BusinessDesk)