Apple, tech companies lift US stocks ahead of Fed
By DAMIAN J. TROISE AP Business Writer
July 31, 2019 07:31 AM
FILE – In this July 22, 2019, file photo specialist Mark Fitzgerald works at his post on the floor of the New York Stock Exchange. The U.S. stock market opens at 9:30 a.m. EDT on Wednesday, July 31.
Richard Drew, File
U.S. stocks edged higher in early trading Wednesday on Wall Street as the technology sector gained ground after a solid earnings report from iPhone maker Apple.
Stocks declined the first days of the week after setting records last week. Investors have been absorbing a heavy flow of corporate earnings amid concerns about trade and economic growth.
Wall Street’s main focus Wednesday is the Federal Reserve’s anticipated announcement on interest rates this afternoon. Investors have been betting that the central bank will cut rates for the first time in a decade to help shore up the U.S. economy as it faces threats to growth from the prolonged trade war with China.
Technology stocks were the clear leaders in the early going, with a nearly 5% increase in Apple shares accounting for most of the gains. Real estate, utilities and energy stocks also gained ground.
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Consumer product makers and consumer-related companies were among the biggest losers, weighed down partly by a slide in Molson Coors Brewing. Communications stocks also fell, led by drops in Facebook and Disney.
KEEPING SCORE: The S&P 500 index rose slightly as of 10 a.m. Eastern time. The Dow Jones Industrial Average rose 57 points, or 0.2%, to 27,250. The Nasdaq composite rose 0.1%.
OVERSEAS: Stocks in Europe were mostly higher. France’s CAC 40 was up 0.2% while Germany’s DAX edged up 0.4%. London’s FTSE 100 fell 0.8%.
Shares in Asia were broadly lower. Japan’s benchmark Nikkei 225 fell 0.9% and South Korea’s Kospi dropped 0.7%. Hong Kong’s Hang Seng dropped 1.3% and the Shanghai Composite shed 0.7%.
CRISP RESULTS: Apple rose 4.8% after beating Wall Street’s profit and revenue forecasts for the quarter while slamming the brakes on the decline of iPhone sales in China.
Sales of the company’s best-known product are still sputtering, but the company has seen increasing revenue contributions from digital services, such as music. The decline of iPhone sales in China slowed drastically during Apple’s third quarter to a 4% drop. Sales of the iPhone plunged 25% during the first half of the fiscal year.
PANCAKED: IHOP and Applebee’s owner Dine Brands Global fell 6.5% after slashing its financial forecast for the year. The company cut forecasts for sales at existing Applebee’s and IHOP locations, along with overall profit, following a disappointing second quarter earnings report.
CLOGGED TAP: Molson Coors Brewing fell 7.6% after the company reported a global decline in volume and sales during the second quarter that weighed down profit. The maker of both Molson and Coors branded beer fell short of analysts’ profit and revenue forecasts. It faced weaker demand in May and June.