By Geoffrey Smith
Investing.com -- U.S. stocks edged higher in early trade on Wednesday as investors paused for breath before two of the most important earnings releases of the season, from Tesla (NASDAQ:TSLA) and Microsoft (NASDAQ:MSFT)
By 10 AM (1400 GMT), the Dow Jones Industrial Average was up 42 points or 0.2% at 26,882 points. The S&P 500 was up 0.3% and the Nasdaq Composite, which hit a fresh record high earlier in the week, was up 0.6%.
Any appetite for further risk-taking at what are already elevated valuations has been kept firmly in check, on the one hand, by the apparent difficulties in crafting another stimulus package to replace many of the support measures that expire at the end of the month, and, on the other, fresh signs of antagonism between the U.S. and China.
The U.S. government has ordered China to close its consulate in Houston, less than a day after indicting two Chinese-based hackers over a decade-long run of theft of U.S. intellectual property.
Various technology stocks succumbed to some early profit-taking after posting quarterly results that were either disappointing, or at least failed to generate fresh buying interest at the current levels. Snap (NYSE:SNAP) stock fell 7% after the owner of the Snapchat social media network said its bump in user growth at the start of coronavirus-led lockdowns petered out sooner than expected. The company also revised down its forecasts for further subscriber growth.
Texas Instruments (NASDAQ:TXN), meanwhile, fell 1%, paring larger premarket losses, after a strong set of quarterly results driven by accelerating demand for chips in all of its major business segments. The stock has still outrun many analysts' 12-month target prices, however, and Barclays (LON:BARC) and UBS both reiterated their recommendations on Wednesday with price targets between 4% and 9% below the current level.
More positively, Spotify (NYSE:SPOT) stock rose 5.9% after the streaming company announced a new multiyear licensing deal with Vivendi 's (PA:VIV) Universal Music Group that reinforces its catalog.
And life sciences group Thermo Fisher (NYSE:TMO) stock rose 4.2% after the company reported a healthy rise in both revenue and profit, fueled by some $1.3 billion in Covid-19-related revenue.
On an otherwise light day for data, the growth in U.S. mortgage applications slowed to 4.1% from 5.1% the previous weeks amid signs that refinancing rates are bottoming out after their sharp decline since March.
Low interest rates have fueled not just a flurry of refinancing, but also a sustained rally in precious metals, with Gold Futures and Silver Futures hitting nine- and seven-year highs in overnight trading, respectively. That drove Pan American Silver (NASDAQ:PAAS) stock another 4.9% higher Wednesday to a nine-year high. It's now more than tripled since bottoming in March.