The U.S. stock market climbed Wednesday, and Apple (AAPL, Financial) shares soared as well.
The Cupertino, California-based company has been doing a great job in the technology industry, and investors seem to be very confident about the firm´s future. Since the Fed had to report at 2 p.m. (EDT), investor´s expectations were kept in check. In fact, the SPX added 4 points or 0.2% where technology stocks were leading these gains. The Dow was also hot in its upward trend climbing 54 points or 0.3%, and the COMP jumped 32 points or 0.6%. Apple shares just soared 7.2% today as well.
Apple shares soar
Since Apple´s profits exceeded expectations, investors were happy, and they bought shares like crazy, showing all the confidence they could muster. Apple has also topped the important Wall Street forecasts.
Investors also want to know whether the Fed is going to raise interest rates in September or not, and they needed to know whether the Fed plans on raising interest rates in the second half of this year or give them a dovish message talking about heightened risks. Anyway, the market believes the Fed will hike interest rates possibly by December.
Oil futures
Oil futures were trading higher and rebounded today. Asian markets were a mix of ups and downs, but European stocks were higher. In addition, investors had to read many conflicting reports about the possibility that the Japanese government will release stimulus measures to keep Japan's economy healthy. Gold futures edged higher and the DXY was slightly higher as well. In addition, durable goods orders sank in the U.S., and this drop was deeper than economists expected. Facebook (FB, Financial) and Whole Foods Market (WFM, Financial) will report after the important market`s close.
Surprises
Earnings declined for Twitter (TWTR, Financial) and Coca-Cola (KO, Financial), which was a surprise to investors all over the world. Investors were happy about Apple`s earning reports but disappointed by Coca-Cola and Twitter. Apple's cheaper iPhone model has been selling well, but it also reported a revenue decline that was smaller than the market expected. Boeing Co. (BA, Financial) experienced a loss that was narrower than investors and analysts expected. Investors were expecting a better sales report from Twitter this quarter, and they were disappointed. So they started selling Twitter shares like crazy. Since sales dropped too much for Cola-Cola, investors were eager to sell this stock Thursday.
On a front burner
As investors didn`t expect the Fed to raise interest rates until December, earnings were on the important front burner Wednesday. Investors have also seen many earning reports that they consider a little disappointing, and they are also worried about a potential rise in interest rates this year. However, when investors put the situation in context, they know that it is up nicely for the month and nicely for this year as well. The Standard & Poor's fluctuated around 2,170 producing five points below its all-time high on Friday too.
The rally
The S&P has been in an 8% rally in the past month because investors expected the Fed will not rush to add some stimulus when the economy shows signs of having picked up some steam. Since some forecasts have beaten a lot of big margins, investors think that the American economy is gaining momentum. In addition, investors think that the Fed will not change borrowing costs in the future as the economy shows signs of tightening. Volume is quieted down, but the stock market was high in the past; investors are seeing the same pattern now.
As you can see, the stock market is up. Apple has done a better-than-expected job in terms of earnings, though these earnings are lower than the previous year. But investors did not have high expectations for the Apple stock, anyway, and they were more than happy to buy tons of stocks in this technology firm. The Bank of Japan (TSE:8301, Financial) will stimulate the Japanese economy with a stimulus package, and investors are expecting this kind of situation in the future. The European market is high, but the Asian markets are experiencing some fluctuation. The global economy is a very dynamic one, and things are always changing. With a strong day and high expectations of outstanding performance, the U.S. stock market is poised for new heights.
Disclosure: I do not own any shares or any stocks mentioned in this article.
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