After ending the previous session firmly in positive territory, stocks are seeing some further upside in morning trading on Wednesday ahead of the Federal Reserve’s monetary policy announcement this afternoon.
Currently, the tech-heavy Nasdaq is outperforming the other major averages. While the Nasdaq is up 55.92 points or 0.7 percent at 7,727.71, the Dow is up 58.50 points or 0.2 percent at 25,473.69 and the S&P 500 is up 7.91 points or 0.3 percent at 2,824.20.
Apple (AAPL) has helped to lead the way higher on Wall Street, with the iPod and iPhone maker jumping by 5.5 percent on the day.
The rally by Apple comes after the company reported better than expected fiscal third quarter results and provided upbeat guidance.
Positive sentiment may also have been generated by a report from payroll processor ADP showing private sector employment in the U.S. increased by much more than expected in the month of July.
ADP said private sector employment jumped by 219,000 jobs in July after climbing by an upwardly revised 181,000 jobs in June.
Economists had expected an increase of about 185,000 jobs compared to the addition of 177,000 jobs originally reported for the previous month.
Meanwhile, a separate report from the Institute for Supply Management showed a slowdown in the pace of growth in manufacturing activity in the month of July.
The ISM said its purchasing managers index fell to 58.1 in July after unexpectedly climbing to 60.2 in June. While a reading above 50 still indicates growth in the manufacturing sector, economists had expected the index to show a more modest drop to 59.5.
“Demand remains robust, but the nation’s employment resources and supply chains continue to struggle,” said Timothy Fiore, Chair of the ISM Manufacturing Business Survey Committee.
He added, “Respondents are again overwhelmingly concerned about how tariff-related activity, including reciprocal tariffs, will continue to affect their business.”
Traders are also looking ahead to the Federal Reserve’s announcement of its latest monetary policy decision at 2 pm ET.
The Fed is widely expected to leave interest rates unchanged, but the accompany statement could provide clues about the outlook for rates.
Financial stocks have shown a strong move to the upside ahead of the Fed announcement, with the NYSE Arca Broker/Dealer Index and the KBW Bank Index climbing by 1.4 percent and 1.3 percent, respectively.
Some strength is also visible among biotechnology stocks, although most of the other major sectors are showing only modest moves in morning trading.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Wednesday. Japan’s Nikkei 225 Index advanced by 0.9 percent, while Hong Kong’s Hang Seng Index slid by 0.9 percent.
Meanwhile, the major European markets have also moved to the downside on the day. While the French CAC 40 Index is just below the unchanged line, the German DAX Index is down by 0.3 percent and the U.K.’s FTSE 100 Index is down by 1.1 percent.
In the bond market, treasuries have moved notably lower ahead of the Fed announcement this afternoon. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 4.2 basis points at 3.006 percent.
by RTTNews Staff Writer
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