By Geoffrey Smith
Investing.com -- U.S. stock markets opened smartly higher on Wednesday as a torrent of largely reassuring earnings persuaded some investors that the worst of the pandemic is over.
By 9:40 AM ET (1340 GMT), the Dow Jones Industrial Average was up 24 points, or 0.1% at 26,403 points. The S&P 500 was up 0.4% and the Nasdaq Composite was outperforming again, with a gain of 0.7%, helped by strong quarterly reports from the likes of chipmaker Advanced Micro Devices (NASDAQ:AMD) and fast-growing online marketplace Shopify (NYSE:SHOP). FireEye (NASDAQ:FEYE) stock also gained 15% after its quarterly report underlined how cybersecurity has gained in importance to companies against the backdrop of increased remote working and online shopping.
Sentiment was further helped by another strong reading from the housing market, a part of the economy that has thrived in recent months against a backdrop of lower refinancing rates and the increased attractiveness of real estate as an investment against a backdrop of high volatility in securities markets. Pending home sales rose 16.6% on the month in June, down from a 44% gain in May but above expectations for a 15% rise.
General Electric (NYSE:GE) stock and General Motors (NYSE:GM) stock both fell slightly, despite posting slightly less-dismal-than-expected results for the quarter, while Boeing (NYSE:BA) stock fell 0.5% after the aerospace giant missed expectations and announced another cut to production runs.
The moves are nonetheless hostage to macro developments in the course of the day. The Federal Reserve’s Federal Open Markets Committee meeting and Chairman Jerome Powell’s press conference at 2:30 PM are likely to stay the main focus of the day.
Comments from senior Fed officials before the regular 'blackout' period before the FOMC tended to the gloomy side, with more than one expressing the fear that the economy was stalling and may need more "accommodative" policy in future. No change in policy is expected in today's statement.
The standout individual performer, for the second day running, was Eastman Kodak Co (NYSE:KODK). The once-dominant maker of photographic film, whose business model was wrecked by the advent of digital technology, had life breathed into it by a $765 million government loan to help it ramp up production of ingredients for generic medicines. The move, under the aegis of the Defense Production Act, is aimed at reshoring production of important medicines back from China. Trading in Eastman Kodak stock was repeatedly halted, limit up, in the first hour of the session.
In other markets,Crude Oil Futures rebounded after the American Petroleum Institute reported a surprisingly large drop in crude inventories last week (mitigated by inventory builds in gasoline and distillates). The rally in Gold Futures and Silver Futures petered out, however, as traders hunkered down in anticipation of the Fed.