US open: Stocks gain on Apple earnings, while investors await Fed's decision
US stocks edged forward on Wednesday, as the Nasdaq reaped the benefits of strong earnings from Apple.
Apple Inc.
$169.30
13:09 26/04/24
META PLATFORMS
$443.29
13:09 26/04/24
Nasdaq 100
17,718.30
12:15 26/04/24
United States Steel Corp.
$37.42
10:59 26/04/24
Just after 10:00 in New York, the Dow Jones Industrial Average was up 72.12 points to 17,459.33 (+0.4%), while the S&P and the Nasdaq advanced 0.4% and 1% respectively.
Wall Street endured a torrid time on Tuesday when US stocks registered their biggest drop in three weeks, dragged down by disappointing earnings and by a sharp decline in durable goods orders.
Wednesday’s major event is the announcement from the Federal Open Market Committee, due at 14:00 ET.
The two-day meeting is unlikely to produce any significant changes to the Fed’s statement, and analysts expect the first hike in short-term interest rates by September.
“Fed hawks will argue that the extremely low level of interest rates across the curve is extremely unusual in an environment in which the labour market is tightening at its current pace,” said Jane Foley, senior currency strategist at Rabobank.
“We have maintained a call for some time that the Fed is unlikely to hike interest rates until the end of this year. If the Fed signal that it is willing to extend its patience on policy moves, than the dollar could soften.”
In corporate news, Apple jumped almost 8% after reporting late on Tuesday its quarterly profit rose 38%, as the company sold 74.5m iPhone units in the period.
US Steel Corp jumped almost 10% after its earnings topped Wall Street’s estimates, while Boeing rose 4% after its fourth quarter beat forecasts.
Yahoo! gained over 3% on plans to spin off its stake in Alibaba into a separate, publicly traded company, while Abiomed surged almost 35% after the medical device maker posted earnings that were much better than Wall Street's estimates.
On Wednesday, investors will focus on Facebook, as the social media giant is due to report after the close.
“Investor nervousness over rising costs will need to be calmed by increasing advertising revenue, particularly from mobile,” said CMC Markets analyst Jasper Lawler.
“Consensus is for mobile to make up 67% of the $3.49bn total ad revenue, so anything above $2.45bn in mobile ad revenue should be bullish for the stock.”
Gold futures fell slightly to $1,285.10, while the dollar advanced marginally against the pound and the yen and gained over 0.5% against the euro.
The price of oil was in decline, with West Texas Intermediate losing almost 2.5% to $45.11 a barrel, while Brent crude slid over 1% to just under $49 a barrel.