Stocks spent most of the morning in the green, softened for a bit midday, and then regained some momentum in the afternoon as investors digested the Federal Reserve's new framework for how it will approach monetary policy and its dual mandates regarding inflation and employment. During the session the S&P 500 got above the round-number level of 3,500 for the first time, though it could not hold there into the close.
ECONOMIC EVENTS: In the U.S., the Federal Open Market Committee of the Federal Reserve has announced the unanimous approval of updates to its Statement on Longer-Run Goals and Monetary Policy Strategy, which "articulates its approach to monetary policy and serves as the foundation for its policy actions." On price stability, the FOMC adjusted its strategy for achieving its longer-run inflation goal of 2% by noting that it "seeks to achieve inflation that averages 2% over time."
In domestic data, the estimate of second quarter GDP was revised up to a 31.7% contraction rate versus the 32.9% contraction rate posted in the advance report. Initial jobless claims dropped 98,000 to 1.006M in the week ended August 22. An index of pending home sales rose 5.9% to 122.1 in July.
TOP NEWS: Shares of Microsoft (MSFT) rose 2.5% after sources told CNBC that TikTok CEO Kevin Mayer's exit indicates that a deal, likely a sale to Microsoft, could come in the next 48 hours. Microsoft confirmed on August 2 that it has held talks with ByteDance to acquire TikTok in the U.S. Oracle (ORCL) has also reportedly shown interest in acquiring the U.S. business of TikTok. After those early reports, Walmart (WMT), which was previously said to have been working with SoftBank (SFTBY) on a potential acquisition of TikTok's U.S. business, confirmed its involvement in a potential TikTok deal in partnership with Microsoft, according to CNBC's Alex Sherman. The news of the possible joint bid sent Walmart shares up 4.5%.
Meanwhile, the most notable competitor to both Walmart and Microsoft - Amazon (AMZN) - made its own headlines this morning with a new foray into the health space. Amazon has introduced Amazon Halo, which it calls a "new service dedicated to helping customers improve their individual health and wellness," along with the Amazon Halo Band, a smartband with sensors to "provide the highly accurate information necessary to power Halo insights."
In COVID-19 news, Abbott Laboratories (ABT) announced that the FDA has issued Emergency Use Authorization for its BinaxNOW COVID-19 Ag Card rapid test for detection of COVID-19 infection. The test, which can deliver results in just 15 minutes, will sell for $5, the company said. Following the news, Quidel (QDEL) announced that it plans to introduce a Sofia Flu + COVID Antigen combination assay, a Sofia Serology assay, and a Solana molecular SARS assay in September. In addition, Politico reported that President Donald Trump will announced the purchase of 150M rapid COVID-19 tests from Abbott as part of a $750M agreement. Abbott shares closed nearly 8% higher, while Quidel plunged 22%.
In earnings news, Dollar General (DG) and Dollar Tree (DLTR) both traded lower following the companies' profit reports, while Box Inc. (BOX) got a 5% boost from its own quarterly update.
Meanwhile, Nikola (NKLA) founder and executive chairman Trevor Milton tweeted that his stake in the company will go down as he's giving away 6M shares to the company's first 50 employees.
MAJOR MOVERS: Among the noteworthy gainers was AMC Entertainment (AMC), which rose 16% after announcing a plan to reopen another 170 locations. Also higher was NetApp (NTAP), which gained 4% after reporting quarterly results.
Among the notable losers was Fluidigm (FLDM), which dropped 26.5% as it was among the COVID-19 diagnostic test makers sliding following the $5 Abbott test approval. Also lower was Williams-Sonoma (WSM), which fell 8% after reporting quarterly results.
INDEXES: The Dow rose 160.35, or 0.57%, to 28,492.27 , the Nasdaq slid 39.72, or 0.34%, to 11,625.34 , and the S&P 500 added 5.82, or 0.17%, to 3,484.55 .
Microsoft
+5.55 (+2.51%)
Oracle
-0.3 (-0.52%)
Walmart
+5.97 (+4.57%)
SoftBank Group
+ (+0.00%)
Amazon.com
-42.59 (-1.24%)
Abbott
+8.1 (+7.85%)
QuidelOrtho
-48.04 (-21.54%)
Dollar General
-2.835 (-1.39%)
Dollar Tree
-7.53 (-7.22%)
Box
+0.94 (+4.87%)
Nikola
+0.52 (+1.34%)
AMC Entertainment
+0.9 (+16.07%)
NetApp
+1.6 (+3.79%)
Fluidigm
-3.02 (-26.44%)
Williams-Sonoma
-7.895 (-7.98%)