Wednesday's Market Recap - Dow Surges Over 400 Points On Dovish Fed, Solid Earnings, Hope For A
What is The Premarket Telling Us?
7:00 AM.
Thanks to better than expected earning results from Apple, and Advanced Micro Devices (AMD), after the close yesterday, US stock futures are moderately higher in the premarket. Dow futures are up 87 points, Nasdaq futures up 53 points and S&P futures up 8 points. Today the FOMC will announce a decision on interest rates. No rate hike is expected, but investors will be listening carefully to Fed Chair Powell, to make sure he's on hold, as the market is forecasting. A US and Chinese delegation begins their meeting in Washington this morning, in a continued attempt at a trade deal.
On The Bond Desk:
The US 10 Year Bond Yield at 2.71%, down 0.03%.
Currency Desk:
Euro dollar: 1.14
UK Pound: 1.31
Crude Oil:
WTI crude oil futures at $53.78/barrel, up 0.88%.
On the Earnings Calendar:
Alibaba reported better than expected quarterly earning results. Shares are moving higher.
Boeing reported a stellar quarter, handily beating earnings, revenues, targets, and other important metrics.
In M&A News:
None.
What About The Asian And European Markets?
Major Asian markets ended mixed. Japan (Nikkei 225) down 0.52%, Shanghai down 0.72%, Hong Kong (Hang Seng) rose 0.40%.
Major European markets also closed mixed. German (DAX) fell 0.33%, France CAC 40 0.95%, London FTSE 100 up 1.58%.
Market And Sector Dynamics
Markets opened the trading session with investors in a ebullient mood, thanks to better than expected earning results from Apple and chipmaker, Advanced Micro Devices (AMD), who reported after the close of trading yesterday evening. This morning, Boeing, Alibaba, and McDonald's did the same, by reporting solid quarterly results, pretty much ensuring markets would be in rally mode in today.
The Dow jumped 250 points, Nasdaq up 76 points, and S&P rose 15 points, with the Boeing and Apple, contributing 200 points to the Dow at the outset. Market breath was 4:1, advancing to declining shares. Shares of chips and semiconductor companies are participating in the rally. By 11:15 AM, the Dow was up 325 points.
Once the Fed/FOMC released it decision to leave interest rates unchanged, and the Chair Powell's press conference and half an hour later, market surged higher, with the Dow reaching more that 520 points, before losing a fraction of those gains into the close.
Today's rally was convincing and broad based, with all eleven S&P sectors closing with solid gains.
Factors Influencing Today's Market
A dovish Fed that seems to be on hold, as confirmed by Fed Chair, Jerome Powell, after FOMC meeting today.
Better than expected earnings results from Alibaba, Advanced Micro Devices, Boeing, and McDonald's, which sent shares of these companies higher.
Crude oil continued it upward move today. WTI crude oil closed at $54.23/barrel, up 1.73%.
This week's US EIA Petroleum Status report showed crude oil inventories rose 0.9 million barrels to 445.9 million barrels.
Major Asian and European markets were mixed in their sessions
Market Close Volume Traded And Advance Decline Ratio
Thanks to Fed Chair Powell, and the FOMC, the bull enjoyed a great day. At the close of trading the the Dow rocketed 434.90 points, Nasdaq surged 154.90 points, and the S&P gained 41.05 points. Total NYSE volume traded, a light 3.82 billion shares. Advancing shares outpaced Declining shares nearly 4:1.
Data Sources: Bloomberg, CNBC, CNN Money, Google Finance, Market Watch, TD Ameritrade, Yahoo Finance.
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