The Q’s Slay On Apple, Fed News

Today was a large day for investors as Apple unleashed its killer earnings report and Dr. Ben and his Fedster team reported on current market conditions and interest rates. The S&P 500 rose 1.36% with the SPDR S&P 500 ETF (NYSEARCA:SPY) rising 1.37%, while the DJIA rose .69% with the SPDR Dow Jones Industrial Average ETF (NYSEARCA:DIA) rising .71%. The Russell 2000 Index rose 1.76% with the iShares Russell 200 Index ETF (NYSEARCA:IWM) rising 1.56%.
 
By far and large, the largest performer today was the NASDAQ, with the NASDAQ composite rising 2.30% while the PowerShares QQQ Trust Series 1 ETF (NASDAQ:QQQ) rose 2.66%. Apple (NASDAQ:AAPL) has appeared to have done it again, as the company’s shares rose 9% today with a reported $11.6 billion Q2 2012 earnings mark compared to a $6 billion earned for Q2 2011. I always speculate about potential bubbles, but that is impressive. Furthermore, it appears that Apple and the Fed, at least for the short term, are the only two factions carrying markets right now, with or without Spanish or European issues. Read more about Apple Earnings here.
 
And, speaking of the Fed:  Again, Dr. Bernanke left policy unchanged and markets did their usual rallying cry. The Chairman predicted that the economy would continue to grow slowly, and that a possibility of a QE3 was still on the table if necessary. Perhaps just the option of more free money on the table was what stirred markets today, however I am willing to believe that Apple’s upward fall from the tree at least fueled the NASDAQ. Read more about the FOMC here.
 
Perhaps without Apple or the Fed, markets would have responded to the negative Advance Durable Goods Order report released today, which indicated that durable goods orders took their most significant decline in three years. Although we have rock star companies like Apple holding markets together, we are still in a tenuous position regarding growth and recovery.
 
Bottom Line:  Markets, and particularly the NASDAQ, responded well to Apple’s killer earnings reports and the Fed’s policy statement. Although interest rates will remain unchanged for now, investors likely feel confident in either the recovery or the Fed or perhaps the option of further easing, as evidenced by markets today. However, we still remain in dangerous waters, as evidenced by today’s extremely negative durable goods report.

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