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An Associated Press report detailed how U.S. stocks drifted higher on Wednesday following strong profit reports from several major companies even as oil prices continued to swing on developments tied to the conflict with Iran. The S&P 500 rose 0.2 percent while the Dow Jones Industrial Average climbed 203 points, or 0.4 percent, and the Nasdaq composite advanced 0.2 percent as of 11 a.m. Eastern time. The moves put the S&P 500 on track for a fourth gain in five days with major indexes remaining near record levels. High expectations surround corporate profit growth for the spring quarter and companies will need to surpass forecasts to justify recent stock price gains according to the report.
BlackRock shares jumped 7.4 percent after the firm reported stronger profit and revenue than analysts had projected for the latest quarter. Its chief executive Laurence Fink said iShares funds topped 6 trillion dollars in assets under management during the period roughly doubling in three years. Bank of New York Mellon rose 3.2 percent and Morgan Stanley added 1.1 percent after posting their own solid earnings. The advances helped counter a 10 percent drop in Elevance Health shares despite that company also beating profit and revenue estimates.
A separate report showed inflation at the wholesale level slowed to 5.5 percent last month from 6 percent in May and the reading came in better than economists expected according to the Associated Press. The prior day had brought a consumer inflation report that likewise was not as severe as anticipated. Such data reduced pressure on the Federal Reserve which is weighing interest rate decisions. Traders now see just a 12 percent chance the Fed will raise its main rate at the next meeting down from nearly 42 percent on Monday per CME Group data and the 10-year Treasury yield eased to 4.55 percent.
Oil prices swung near their highest levels in a month with Brent crude briefly topping 86 dollars per barrel before falling back to 83.77 dollars down 1.1 percent from the previous close. The volatility stems from the war with Iran which has featured strikes across the Middle East and threats to energy shipments. Iran’s Revolutionary Guard stated the export of oil and gas from the region will be either for everyone or for no one. The Associated Press has tracked how such developments have repeatedly jerked markets in recent weeks.
Technology stocks powered gains in several overseas markets as the artificial intelligence boom regained momentum. South Korea’s Kospi index surged 6.2 percent with the benchmark dominated by Samsung Electronics and SK Hynix. From Amsterdam ASML which makes machinery for chip production reported revenue growth above forecasts for the quarter and its chief executive Christophe Fouquet cited customers accelerating expansions due to artificial intelligence progress. The results helped temper recent worries that AI-related valuations had risen too far too fast.
In China stocks rose 1.4 percent in Hong Kong but slipped 0.3 percent in Shanghai after the government reported the world’s second-largest economy expanded at a 4.3 percent annualized pace last quarter down from 5 percent at the start of the year. The AP report noted this performance arrives against a backdrop of broader global uncertainties including those stemming from the Middle East conflict. Corporate earnings momentum in the United States has so far helped sustain investor appetite despite the external pressures on energy costs and inflation.
