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World News
Stock index futures pared gains sharply on Thursday, with traders citing talk about a possible downgrade of France's sovereign debt rating as French debt yields hit nearly 3-month highs.
Iraq's oil ministry said Thursday that the U.S. oil giant Exxon Mobil Corp. is not allowed to bid in the May energy auction because of its oil deals with the northern self-ruled Kurdish region in Iraq.
The Texas-based Exxon signed six deals with the Kurds last October to search for oil in six areas, bypassing the Baghdad government, which maintains that it must ratify all deals. Some of the deals cover areas located in a land claimed by both Kurds and Arabs.
US Markets
As critical bank earnings keep rolling in, there's been some confusion beneath the headlines. If a bank simply beats earnings estimates, does it warrant a pop in share prices?
This is the reaction we're seeing this morning with Bank of America's (BAC) and Morgan Stanley's (MS) earnings beats. But earlier in the week J.P. Morgan (JPM), Wells Fargo (WFC), and Goldman Sachs (GS) topped expectations, yet traded lower.
All of these big banks, including U.S. Bancorp (USB), reported higher-than-expected revenue growth, while Citigroup's (C) remained flat. While this seems positive, you need to understand what's behind the numbers. As The Wall Street Journal pointed out after JPM and WFC reports, the banks topped revenue estimates mostly because they scaled down future loan loss coverage.
Nonetheless, some degree of confidence has pushed bank stocks to lead the 2012 rally. The Financial Sector SPDR (XLF) is up 18% year-to-date versus the S&P 500's 10% rise.
Spain, the latest trouble spot in the euro zone debt crisis, sold 2.5 billion euros ($3.3 billion) of bonds, but yields rose as Madrid struggled to tame its deficit.