The U.S. Federal Reserve is likely to hold interest rates steady today, the markets are poised to keep moving up plus stocks to watch in the Money and Markets Wall Street Wake-Up.
The Morning Open
U.S. markets opened mostly up Wednesday morning.
As of 10:15 a.m. Eastern time, the Dow Jones Industrial Average was up 0.1% while the S&P 500 moved up 0.01%. The Nasdaq Composite was off 0.05%.
In other market news:
December pending home sales dropped 4.9%, according to data from the National Association of Realtors.
While December is traditionally the slowest month of the year for home sales, pending home sales in December 2019 were up 4.6% compared to December 2018.
The South suffered the largest decline in pending home sales of any region — 5.5% — however the area did have a 7.4% increase over the same time a year ago.
The Opening Bell
Expect Apple Inc. (Nasdaq: APPL) to be the talk of Wall Street today as its quarterly earnings report blew the doors off analyst estimates.
Its earnings per share for the quarter was $4.99 — $0.44 over estimates — while revenue was reported at $91.8 billion — compared to estimates of $88.5 billion. That’s a 9% jump in revenue and it even beat the company’s own guidance.
Apple CEO Tim Cook called the quarterly report “blockbuster.”
Sales of its iPhone drove revenue — sales were up 8% to $55.9 billion. Its Apple Watch and AirPod sales did $10 billion in sales while its software line — iCloud, Apple TV+ and AppleCare — sales were up 17% year-over-year to $12.7 billion.
The company put its Q2 revenue guidance at $63 billion to $67 billion and its margin guidance at 385 to 39%.
Stocks to Watch Today
General Electric Co. (NYSE: GE) — Shares of the company were up 5.8% in Wednesday premarket trading after it reported beating quarterly earnings projections.
Boeing Co. (NYSE: BA) — The American aircraft manufacturer posted its first annual loss in more than two decades Wednesday. The company reported a $2.33 per-share loss. Shares of Boeing were up 3.3% in premarket trading, however.
L Brands Inc. (NYSE: LB) — Shares of Victoria’s Secret’s parent company surged 10.5% in premarket trading after it was reported that founder Les Wexner was looking to step down as CEO. It was also reported Wexner could be looking at a partial or complete sale of the Victoria’s Secret brand.
In the News
The Federal Reserve likely won’t announce any surprises at the end of its January policy meeting.
It’s likely the Fed will keep interest rates flat at 1.5% to 1.75% and maintain “their wait-and-see policy stance,” according to The Wall Street Journal.
The Fed will release its policy statement at 2 p.m. ET and Fed Chairman Jerome Powell will speak with the media at 2:30 p.m.
China Coronavirus Could Hamper Phase One Trade Deal With US
A prolonged outbreak of the coronavirus could have a negative impact on China fulfilling its end of a phase one trade deal with the U.S.
Under the terms of the deal, China is to increase its imports of American goods and agricultural products.
As of Wednesday, the virus has killed 132 — all in China. The number of infected rose above 6,000. That’s above the number of infected during the 2002-2003 outbreak of SARS.
The coronavirus has forced a lock down of Wuhan, Hefei and Jiangsu, all big manufacturing hubs with ties to U.S. companies.
MacKenzie Bezos Dumped a Ton of Amazon Stock
Amazon.com Inc. (Nasdaq: AMZN) CEO Jeff Bezos’s ex-wife MacKenzie Bezos has sold nearly $370 million worth of her shares in the company, according to CNN Business.
She received 19.7 million shares of Amazon as part of her divorce agreement — approximately 4% of the company’s total shares outstanding.
Other Morning Reads
What Is the Coronavirus and Should Investors Be Worried (Money and Markets)
Victoria’s Secret Billionaire in Talks to Sell Brand (The Wall Street Journal)
Coronavirus Prompts Yield Curve Inversion (Money and Markets)
Earnings Report
Here are the companies releasing earnings reports today:
AT&T Inc. (NYSE: T)
Facebook Inc. (Nasdaq: FB)
General Electric Co. (NYSE: GE)
Las Vegas Sands (NYSE: LVS)
Microsoft Corp. (Nasdaq: MSFT)
Chart of the Day
Countries making up nearly one-third of the world’s GDP have banned the use of products made by Chinese tech giant Huawei.
In addition to the U.S., Australia, New Zealand, Japan and Taiwan are among the counties that have banned using the products to build out 5G infrastructure.
The ban comes out of fear that Huawei will be prompted by the Chinese government to use its technology to spy on other countries.
Check back each morning before the opening bell for stocks to watch today with the Wall Street Wake-Up, here on Money and Markets.