By Barbara Kollmeyer and Sara Sjolin, MarketWatch
Apple surges 9% premarket
LONDON (MarketWatch) -- Nasdaq looked poised for an upbeat
session on Wednesday, with Apple Inc. set to do the heavy lifting
in the wake of the iPhone maker's blowout earnings.
Other stock futures turned higher as investors reacted to the
latest round of results. Also on the day's calendar is the outcome
of the Federal Open Market Committee meeting.
Leading the way higher, futures for the Nasdaq-100 (NDH5) surged
48.50 points, or 1.2%, to 4,226. Those for the Dow Jones Industrial
Average (DJH5) climbed 28 points, or 0.2%, to 17,406, while futures
for the S&P 500 index (SPH5) gained 7.50 points, or 0.4%, to
2,037.50.
Futures had wobbled earlier in the morning, and investors had a
right to be wary, considering the carnage on Wall Street Tuesday.
U.S. stocks saw the biggest drop in three weeks, hammered by
disappointing earnings from economic bellwethers such as
Caterpillar Inc. (CAT), Microsoft Corp. (MSFT) and a sharp fall in
durable-goods orders. The S&P 500 index (SPX) fell 1.3%.
Apple and Fed: Apple was set to help turn sentiment around on
Wednesday, at least for tech stocks, after reporting another record
for its flagship iPhone, with 74.5 million phones sold in the
fiscal first quarter. Profit rose 38% to a record high and shares
jumped 9% in premarket trade.
Check out a recap of Apple's conference call
Plus: Has Apple grown overly dependent on the iPhone?
The only economic event for Wednesday is the FOMC announcement,
due at 2 p.m. Eastern Time. The two-day meeting isn't expected to
produce any major changes to the Fed's statement, and Goldman Sachs
and others expect the first hike in short-term interest rates by
September. But Ellen Zentner, economist at Morgan Stanley said
Tuesday that she doesn't expect a Fed hike until March 2016, partly
because the downward pressure on inflation is stronger than
expected.
A strong dollar, which has been cutting into corporate earnings,
and weak oil prices mean investors are hoping the Fed will delay
that hike, and they will be looking for a signal from the
statement.
Doubts grow about midyear rate hike, but Fed won't express
any
Yahoo, Boeing in focus: Shares of Boeing (BA) gained 3.9%
premarket after the company's fourth-quarter earnings beat
forecasts.
Yahoo Inc. (YHOO) leapt 6.9% ahead of the bell after the
Internet search engine late Tuesday said it would spin off its
Alibaba Group Holding Ltd. (BABA) stake into a separate, publicly
traded company.
U.S. Steel Corp. (X) jumped 8.1% premarket after the steel
producer's earnings that were released on Tuesday topped Wall
Street estimates.
Abiomed Inc. (ABMD) surged 29% after the medical device maker
posted earnings that blew out Wall Street estimates.
On the downside, Ethan Allen Interiors Inc. could follow up a
13% late-session drop after weaker-than-expected results in its
holiday quarter.
Shake Shack Inc. (SHAK) raised the terms for its initial public
offering and said it will offer 5.75 million shares and expects
them to be priced at $17-$19 a share.
Overseas markets: Europe stocks were mixed, with Greece
suffering from another selloff after Prime Minister Alexis Tsipras
stressed he will push for debt relief from the country's
international creditors. The Global X FTSE Greece 20 ETF (GREK)
dropped 8.8% in premarket U.S. trade.
The Nikkei 225 index rose to a fresh one-month high as the yen
weakened against the dollar and other currencies.
Crude-oil prices (CLH5) fell another 80 cents to $45.43 a
barrel, as another investment bank downgraded its forecast for the
commodity. Barclays cut its forecasts for WTI crude to $42 a barrel
for 2015 from $66 and $57 a barrel for 2016. For Brent crude,
Barclays cut its forecast to $44 a barrel for 2015 from $72 and
forecast $60 for 2015.
Gold prices (GCG5) drifted lower ahead of the FOMC meeting.
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