FOX Business: The Power to Prosper
The markets rallied after technology behemoth Apple posted strong quarterly results, trumping a considerably weaker-than-expected durable goods report.
As of 3:13 p.m. ET, the Dow Jones Industrial Average gained 89.9 points, or 0.69%, to 13092, the S&P 500 rose 18.5 points, or 1.4%, to 1391 and the Nasdaq Composite soared 66.6 points, or 2.2%, to 3028.
Equities had little response to the Federal Reserve's monetary policy statement that came largely in-line with expectations. The central bank reaffirmed its pledge to keep interest rates at extraordinarily low levels until late 2014, saying that global financial strains still pose a risk to the U.S. economy. It also largely brushed off inflation concerns, saying that while inflation has risen, it is still within or below target levels and expectations remain anchored.
Separately, Fed officials increased their projections for 2012 economic growth and core inflation, and lowered their forecast for the unemployment rate. The projections also showed seven officials at the Federal Reserve expect the central bank to hike interest rates in 2014, up from five when projections were released in January.
Apple, the world's biggest publicly-traded company by market capitalization, earned $11.6 billion in its fiscal second quarter on sales of $39.2 billion, easily beating analysts' expectations. The iPad-maker's shares, which had seen selling pressure over the previous 11 trading days, soared some 10% on Wednesday.
The company makes up 29% of the closely-watched Nasdaq 100 index of non-financial companies and 4% of the S&P 500, according to Reuters, meaning moves can have an outsized affect on Wall Street as a whole.
Caterpillar posted first-quarter earnings of $2.37 a share on revenue of $15.98 billion. Analysts were looking for $2.13 a share on $16.22 billion. The world’s biggest heavy machinery maker also said it expects to earn about $9.50 a share for the full year, weaker than consensus estimates of $9.54. Shares were down more than 2%, costing the Dow some 20 points.
Boeing unveiled first-quarter earnings of $1.22 a share on sales of $19.4 billion, handily beating expectations of 94 cents on $18.37 billion. The airplane maker also lifted its full-year forecast to a range of $4.15 a share to $4.35 from $4.05 to $4.25.
Overall, first-quarter earnings season has been strong, analysts have said, boosting hopes that American firms may be able to dodge the malaise in Europe and slowing growth in China.
It is set to be a busy day on the economic front as well.
The Commerce Department reported orders for long-lasting goods plunged 4.2% in March, the biggest decline since January 2009 and a significantly steeper drop than the 1.7% expected. Excluding the transportation segment, orders were down 1.1%. Economists had been expecting a 0.5% gain.
Energy futures were to the downside following a mixed weekly inventory report from the Energy Department. Oil inventories rose by 3.98 million barrels last week, a bigger build than the 2.7 million that analysts expected. However, gasoline inventories tumbled 2.24 million barrels, a wider draw than the 900,000 expected.
Crude oil traded in New York fell 31 cents, or 0.3%, to $103.24 a barrel. Wholesale New York Harbor gasoline dipped 1.3% to $3.12 a gallon.
In metals, gold slid $13.70, or 0.83%, to $1,630 a troy ounce.
European blue chips rallied 1.7%, the English FTSE 100 rose 0.16% to 5719 and the German DAX soared 1.7% to 6705.
In Asia, the Japanese Nikkei 225 climbed 0.98% to 9561 and the Chinese Hang Seng slumped 0.15% to 20646.