STOCK MARKET NEWS: Boeing lifts Dow, Teva soars on legal deal, Fed hikes rates
US stocks rose after strong tech earnings and ahead of the Federal Reserve’s decision on interest rates. FOX Business is providing real-time updates on the markets, commodities and all the most active stocks on the move.
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The Federal Reserve on Wednesday raised its benchmark interest rate by 75 basis points for the second straight month as it tries to bring scorching-hot inflation under control, a move that threatens to slow U.S. economic growth and exacerbate financial pressure on Americans.
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The software giant is on pace for the highest close since July 2022, when it closed at $267.66 .
Also on pace for largest percent increase since August 2020, when it rose 5.62% according to Dow Jones Market Data Group.
U.S. stocks rallied ahead of the Federal Reserve's decision on interest rates and following solid earnings from Microsoft and Google. Boeing also got a bounce after clarifying plans to restart deliveries of its 787 Dreamliner.
Teva Pharmaceuticals jumped by double-digits after reaching a settlement in opioid lawsuits.
“We are also pleased to have reached a nationwide agreement in principle, pending participation by states and subdivisions, to resolve the majority of our costly legacy opioids litigation, and importantly, make critical medicines available to those most impacted by the U.S. opioid epidemic” said Mr. Kåre Schultz, Teva's President and CEO.
Teva will pay up to $4.25 billion plus $100 million for the Tribes, spread over 13 years the company detailed.
Tuesday's Mega Millons drawing came up empty pushing the jackpot to $1 billion in what will be one of the largest purse's in history. Next drawing: Friday.
U.S. stock futures are higher on Wednesday as investors await the Federal Reserve's decision on interest rates.
The Fed is widely expected to impose a second three-quarter-point hike after its two-day meeting on Wednesday.
Read more Fed news: Fed prepares another rate hike, risking deeper economic downturn
Data released on Wednesday from the Mortgage Bankers Association’s found mortgage applications fell 1.8% from the previous week.
The decrease was the fourth week in a row as home purchase activity nears pandemic levels.
Cryptocurrency prices were trending higher early Wednesday.
At approximately 5 a.m. ET, Bitcoin was trading at nearly $21,400 (+0.68%), or higher by almost $145.
For the week, Bitcoin was trading lower by nearly 9%. For the month, the cryptocurrency was slightly higher, gaining more than 0.75%.
Ethereum was trading at approximately $1,465 (+1.76%), or higher by about $25.
For the week, Ethereum was trading lower by about 6.25%. However, for the month, it was trading higher by nearly 20%.
Dogecoin was trading at 0.062665 (+0.17%), or higher by approximately $0.0019.
For the week, Dogecoin was lower by more than 9.15%. For the month, the crypto was lower by nearly 15%.
The Federal Reserve is set to escalate its war against inflation this week with another super-sized interest rate hike, risking a deeper recession when the U.S. economy is already slowing.
With inflation unexpectedly accelerating to a fresh 40-year high in June and the job market still growing at a healthy clip, the Fed is under mounting pressure to move more aggressively to tame demand and slow surging consumer prices.
But there are signs the economy is starting to cool off: The number of Americans filing for unemployment benefits has gradually increased, companies have announced layoffs or hiring freezes and the housing market is softening.
Gross domestic product slowed in the first quarter of the year by 1.6%, and is expected to decline again in the second quarter.
Despite that, Fed policymakers remain laser-focused on bringing inflation under control as higher prices prove persistent — even if it triggers a recession.
Fed Chairman Jerome Powell told reporters last month that failing to restore price stability would be a "bigger mistake" than crushing growth and causing a downturn.
Central bank policymakers raised the benchmark interest rate by 75 basis points in June for the first time since 1994 and signaled that another increase of that magnitude is possible in July.
The average price of a gallon of gasoline slipped Wednesday morning to $4.302, according to AAA.
Gas prices nationwide were $4.327 on Tuesday and $4.355 on Monday.
Prices have been on the decline since hitting a high of $5.016 on June 14, more than seven weeks ago.
One week ago, the average price of a gallon of gasoline was $4.467. One month ago, that same gallon of gasoline was $4.897. One year ago, a gallon of gasoline was $3.158, according to AAA.
Diesel prices dropped early Wednesday with the national average for a gallon of diesel at $5.365.
A gallon of diesel was $5.386 on Monday. A week ago, a gallon of diesel sold for $5.497. A month ago, that same gallon of diesel sold for $5.794. One year ago, a gallon of diesel cost $3.274 AAA reported.
US stocks were higher early Wednesday as investors await word from the Federal Reserve following its FOMC meeting conclusion in the early afternoon on an expected 75-basis point rate hike.
On Wall Street Tuesday, big-cap consumer/tech titans fell sharply Tuesday, with Microsoft and Alphabet tumbling more than 2.3% before reporting earnings after the bell. Those two stocks, and Meta Platforms, are the only losers in the group this month.
The benchmark S&P 500 index fell 1.2% to 3,921.05. The Dow Jones Industrial Average dropped 0.7% to 31,761.54. The Nasdaq composite closed 1.9% lower at 11,562.57.
Walmart slumped 7.6% after the retail giant cut its profit outlook for the second quarter and the full year late Tuesday. It said rising prices for food and gasoline are forcing shoppers to cut back on more profitable discretionary items, particularly clothing.
The retailer's profit warning in the middle of the quarter is rare and raised worries about how the highest inflation in 40 years is affecting the entire retail sector.
Other major chains also fell. Target dropped 3.6%, Macy’s slid 7.2% and Kohl’s fell 9.1%.
General Motors fell 3.4% after its second-quarter profit fell 40% from a year ago.
U.S. sales fell 15% after shortages of processor chips and other components left the company unable to deliver 95,000 vehicles during the quarter.
Meanwhile, Asian stock markets followed Wall Street lower Wednesday. Shanghai, Hong Kong and South Korea declined. Tokyo and Sydney advanced.
The Shanghai Composite Index lost 0.1% to 3,274.37 while Tokyo's Nikkei 225 advanced 0.3% to 27,728.93.
The Hang Seng in Hong Kong sank 1.5% to 20,590.46. The Kospi in Seoul retreated 0.4% to 2,401.78 and Sydney's S&P-ASX 200 gained 0.1% to 6,814.00.
India's Sensex opened up 0.3% at 55,418.55. New Zealand, Bangkok and Jakarta advanced while Singapore declined.
Oil prices held steady on Wednesday as concerns about weaker demand offset industry data that showed a larger-than-expected drawdown in U.S. crude stockpiles.
Brent crude futures were at $104.55 a barrel at 0640 GMT, up 15 cents, or 0.1%.
U.S. West Texas Intermediate (WTI) crude rose 27 cents, or 0.5%, to $95.25 a barrel.
After Tuesday's settlement, industry group the American Petroleum Institute said crude stocks in the United States fell by 4 million barrels last week. That was four times bigger than the decline expected by analysts in a Reuters poll.
"A sharper decline in inventories should support oil prices, but the rebound was limited by concerns about potential weak demand, and the White House stated that it will further release strategic reserves," said Leon Li, a Shanghai-based analyst at CMC Markets.
The Biden administration said on Tuesday it will sell an additional 20 million barrels of oil from the country's Strategic Petroleum Reserve as part of a previously announced plan to tap the facility to calm oil prices boosted by Russia's invasion of Ukraine and a recovery in demand following the COVID-19 pandemic.
The administration said in late March it would release a record 1 million barrels of oil per day for six months from the SPR.
The United States has already sold 125 million barrels from the reserve with nearly 70 million barrels delivered to purchasers.
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