U.S. stocks surged Wednesday on the Federal Reserve’s decision to hold interest rates steady, which built on the momentum earlier in the session from better-than-expected results from Dow components Boeing and Apple.
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The move by the U.S. central bank, which was widely expected after it signaled a dovish approach in 2019 during their December policy meeting, boosted the blue-chip Dow Jones Industrial Average more than 500, lifting the index to its highest level this year.
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Strong earnings started the markets climbing early in the day. Apple shares rose after the company reported a sharp growth in services business and Chief Executive Officer Tim Cook said trade tensions between the United States and China were easing.
The Cupertino, California-based company reported earnings per share of $4.18, roughly in line with the $4.17 expected by analysts polled by Refinitiv and a 7.5 percent increase compared to one year ago. Quarterly revenue fell 5 percent to $84.3 billion, slightly above an expected $83.97 billion.
| Ticker | Security | Last | Change | %Chg |
|---|---|---|---|---|
| I:DJI | DOW JONES AVERAGES | 25003.31 | +423.35 | +1.72% |
| SP500 | S&P 500 | 2679.2 | +39.20 | +1.48% |
| I:COMP | NASDAQ COMPOSITE INDEX | 7175.3134 | +147.02 | +2.09% |
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Apple reported iPhone revenue of $51.98 billion, which fell below Wall Street’s expectations and marked a 15 percent decline year-over-year. Cook attributed the shortfall to economic pressures in China and a slowdown in how often Apple customers are choosing to trade in their old iPhones for newer models.
Boeing topped expectations with both quarterly profit and its forecast for 2019 cash flow on Wednesday, as a boom in air travel underpinned a prediction for full-year deliveries of around 900 commercial airplanes.
McDonald’s beat estimates for quarterly same-store sales on Wednesday, powered by a strong international performance . Global sales rose 4.4 percent.
Excluding items, the company earned $1.97 per share, beating the $1.89 analysts on average had expected.
Technology and consumer-related companies are in the spotlight later when Facebook, Microsoft, Tesla and Qualcomm report after the markets close.
| Ticker | Security | Last | Change | %Chg |
|---|---|---|---|---|
| AAPL | APPLE INC. | 165.30 | +10.62 | +6.87% |
| BA | BOEING COMPANY | 387.82 | +22.91 | +6.28% |
| MCD | MCDONALD’S CORP. | 181.16 | -1.01 | -0.55% |
In Wednesday’s economic data, the private sector added 213,000 jobs in January, according to the payroll processing firm ADP. That came in higher than the Wall Street estimate for 178,000.
This comes ahead of Friday’s nonfarm payroll report from the labor department. Employers are expected to have added 165,000 workers with the unemployment number holding at 3.9 percent.
In one other report, pending home sales fell 2.2 percent in December.
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In Asian markets on Wednesday, China’s Shanghai Composite index settled 0.7 percent lower.
Hong Kong’s Hang Seng finished the day up 0.4 percent.
Japan’s Nikkei ended the day down 0.5 percent.
In Europe, the major markets closed mixed. London’s FTSE gained 1.6 percent, Germany’s DAX slipped 0.3 percent and France’s CAC added just shy of 1 percent.
