Stocks: Tuesday's review

Japan’s stocks rose for a second day, led by financial shares, on speculation tax breaks will be maintained and after Deutsche Bank AG restated its “overweight” rating on bank shares.
Nomura climbed 1.5 percent to 527 yen, the highest since June 23, and was the most actively traded stock by value in Japan. Daiwa Securities Group Inc., the second-biggest, rose 2.9 percent to 427 yen. Mizuho Securities Co. leapt 4.1 percent to 228 yen.
Yesterday two government officials said Japan may extend a capital-gains tax break by a year after the Financial Services Agency opposed ending it in 2011 as scheduled.
Mitsubishi UFJ increased 0.5 percent to 433 yen. Sumitomo Mitsui Financial Group Inc., Japan’s second-biggest bank by market value, rose 0.6 percent to 2,805 yen. Mizuho Financial Group Inc., the No. 3, gained 0.7 percent to 144 yen.
Machinery makers extended yesterday’s gain after Credit Suisse raised its rating on NTN, a bearing maker, to “outperform” from “neutral” today. NTN Corp., a bearing maker, and Olympus Corp., an optical-equipment maker, jumped at least 3.6 percent.
Inpex Corp., Japan’s No. 1 oil explorer, rose 2.6 percent to 480,000 yen, the highest close since July 5. Japan Petroleum Exploration Co., the nation’s second-biggest oil driller, climbed 3.9 percent to 3,170 yen. The index group that includes those companies had the biggest increase in the Topix. JX Holdings Inc., Japan’s No. 1 oil refiner and copper producer, advanced 1.7 percent to its record high of 556 yen.

European stocks climbed for a seventh day, their longest winning streak in almost six months, as better-than-forecast retail sales in the U.S. offset declines in basic-resource shares and carmakers.
Air France and Lufthansa climbed 1.4 percent to 14.40 euros and 1.7 percent to 17.34 euros, respectively. The two airlines were raised to “outperform” from “neutral” at Credit Suisse.
Mediaset SpA, the broadcaster owned by Silvio Berlusconi, surged 3.3 percent to 4.64 euros after the Italian Prime Minister survived a confidence vote as rebel lawmakers failed to muster enough support to topple his government.
TUI AG rallied 5.1 percent to 9.83 euros as the German owner of Europe’s largest travel company said profit at Hapag- Lloyd boosted its full-year operating result. Hapag contributed 150 million euros ($200.9 million) to net income compared with a loss of 174 million euros a year earlier, Hanover, Germany-based TUI said today. German investor confidence improved for a second month in December as the recovery in Europe’s largest economy showed signs of broadening. The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations increased to 4.3 from 1.8 in November. Economists predicted a gain to 3.9.
A housing-market gauge in the U.K. stayed close to its lowest level in 18 months in November as demand for homes waned, the Royal Institution of Chartered Surveyors said.
BP Plc gained 3.2 percent to 473.1 pence as the international oil company sold fields in Pakistan to Hong Kong- based investment group United Energy Group Ltd. as part of its plan to pay for the Gulf of Mexico oil spill.
Vestas Wind Systems A/S rose 4.7 percent to 181.90 kroner. The company won an order for 30 turbines of its V52-850 kilowatt model for a project in Cape Verde, the company said.
Vilmorin & Cie. gained 3.3 percent to 85.75 euros after Europe’s second-biggest seed company was raised to “outperform” from “underperform” at CA Cheuvreux.
ProSiebenSat slumped 5.7 percent to 21.68 euros for the largest decline in the Stoxx 600 after Die Welt newspaper reported that Kohlberg Kravis Roberts & Co. and Permira LLP aim to sell the broadcaster next year. Die Welt cited unidentified people in the financial markets.

U.S. stocks eased off earlier gains but finished higher Tuesday, as investors found little reason to jump into the fray after the Fed kept rates steady and left its bond-buying plan alone.
About two-thirds of the 30 Dow issues advanced, with AT&T (T, Fortune 500), Kraft Foods (KFT, Fortune 500), Verizon (VZ, Fortune 500), Johnson & Johnson (JNJ, Fortune 500) and Microsoft (MSFT, Fortune 500) leading the way.
Stocks had rallied out of the gate Tuesday morning, following a better-than-expected retail sales report from the U.S. Commerce Department, and held onto gains for most of the afternoon.
All three major indexes have gained about 5% this month, and are up more than 6% for the quarter. Stocks are on track for double-digit gains for the year.
Economy: Retail sales were better than expected, with strength in gasoline prices and clothing sales. U.S. retail sales rose 0.8% in November, the Commerce Department said, which was better than the 0.5% increase economists were expecting. Excluding the automotive sector, sales jumped 1.2% -- more than the 0.6% increase anticipated.
The producer price index increased 0.8% in November -- higher than the 0.5% gain expected. Core PPI, which excludes food and energy prices, rose 0.3% -- a larger increase than the 0.2% expected.
A report from the Commerce Department showed that business inventories grew 0.7% in October, following a 0.9% uptick the prior month. Economists were expecting inventories to rise 1.1%.
As expected, the Federal Reserve held interest rates near 0%, where they have been since the financial crisis took hold in 2008.
The central bank also maintained its rhetoric on the economy, saying that although it is recovering, the pace is not fast enough to combat the unemployment rate.
The Fed said it is moving ahead with its plan to pump $600 billion into the economy, known as quantitative easing or QE2, and did make any changes to the program.
Companies: Best Buy (BBY, Fortune 500) shares slid 15% in early trading, after the home electronics retailer lowered its fiscal year outlook and posted a 3.3% decline in quarterly same-store sales.
Shares of General Electric (GE, Fortune 500) edged higher after the company released presentation slides ahead of its annual investors meeting that reiterated the company's upbeate outlook. GE said it "will deliever solid earnings growth in 2010, 2011 and beyond," as its performance continues to strengthen.