Stocks end higher as Fed keeps rates unchanged, commits to continued support
The major averages were rebounding this morning ahead of the Federal Reserve's rate setting announcement and the upward move was solidified following the conclusion of the bank's FOMC meeting. While the Fed did not announce any policy changes, it did repeat its call to use all the tools in its arsenal to support the economy until the COVID-19 pandemic has passed.
ECONOMIC EVENTS: In the U.S., the advance goods trade deficit narrowed to $70.6B in June from $75.3B in May. An index of pending home sales climbed 16.6% to 116.1 in June.
In central bank news, the Federal Reserve kept rates unchanged, saying that COVID-19 continues to pose considerable risks. The Fed noted in its statement that the path of the economy going forward will depend "significantly on the course of the virus" and that the committee expects to maintain its current federal funds rate "until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals."
The latest data from the Johns Hopkins Whiting School of Engineering shows there are now 16.8M confirmed cases of COVID-19 worldwide, including 4.36M in the U.S., and 661,349 deaths due to the disease.
TOP NEWS: Shares of Boeing (BA) fell 2.9% after the company reported lower than expected revenue and steeper than expected losses in the second quarter. "To align to the sharp reduction in commercial market demand in light of COVID-19, the company is taking several actions including further adjusting commercial airplane production rates and reducing employment levels.
Shares of General Motors (GM) and (GE) were both lower as well, falling 1.75% and 4.35%, respectively, following their mixed earnings reports. The automaker reported better than expected losses on worse than expected sales, while the diversified industrial products maker posted better revenue than forecast with worse than expected losses.
In other large cap earnings news, Starbucks (SBUX) closed 3.7% higher following its report last night, while Visa (V) shares gained just under 1%.
Ahead of the start of a U.S. House of Representatives antitrust hearing that featured Facebook (FB) CEO Mark Zuckerberg, Google's (GOOG) Sundar Pichai, Amazon's (AMZN) Jeff Bezos, and Apple's (AAPL) Tim Cook, President Donald Trump tweeted that he will "bring fairness to Big Tech" through executive orders if Congress fails to do so. "In Washington, it has been ALL TALK and NO ACTION for years, and the people of our Country are sick and tired of it!" the president tweeted.
MAJOR MOVERS: Among the noteworthy gainers was AMD (AMD), which rose 12.5% after it reported better than expected Q2 results and provided upbeat Q3 and FY20 revenue guidance. Also higher after reporting quarterly results were Tupperware Brands (TUP), Community Health (CYH), and Shopify (SHOP), which gained a respective 67.7%, 9.2%, and 7%.
Among the notable losers was Alector (ALEC), which slid 23.6% after it reported preliminary data from its AL001 Phase 1b and Phase 2 studies. Also lower were Seagate (STX), Imax (IMAX), and Spotify (SPOT), which fell 8.8%, 10.6%, and 1.8%, respectively, after reporting quarterly results.
INDEXES: The Dow rose 160.29, or 0.61%, to 26,539.57, the Nasdaq gained 140.85, or 1.35%, to 10,542.94, and the S&P 500 advanced 40.00, or 1.24%, to 3,258.44.