US pre-open: Stocks seen higher as investors cheer Apple results

US futures pointed to a firmer open on Wall Street as investors welcomed encouraging earnings from technology giant Apple ahead of the Federal Reserve’s latest rate announcement.

At 1035 BST, Dow Jones Industrial Average and S&P 500 futures were up 0.2%, while futures on the tech-heavy Nasdaq were 0.7% higher.

Jasper Lawler, market analyst at CMC Markets, said: “US stocks look set to rise on the open thanks an expected jump in Apple shares after the tech giant sold more iPhones than expected in the second quarter, helping profits and revenues beat expectations."

At the same time, oil prices were a touch weaker. West Texas Intermediate was down 0.5% at $42.71 a barrel while Brent crude was 1% lower at $44.43.

Sentiment was also boosted by news of a Japanese stimulus package. Japanese Prime Minister Shinzo Abe said on Wednesday that the government would deliver a stimulus package of Y28tn ($265bn), half of which would comprise fiscal measures. The news comes ahead of the Bank of Japan’s policy announcement on Friday.

Investors were also looking ahead to the Fed’s rate announcement later on Wednesday, although it is widely expected to keep interest rates unchanged.

Craig Erlam, senior market analyst at Oanda, said: “This evening’s announcement is therefore all about the statement and whether it will be used to build expectations of a hike in the second half of the year or deliver a more dovish message highlighting the heightened risks, including Brexit.

“As it stands, the markets have once again come around to the idea that there will be another hike this year, pricing in a 51% chance of it happening by December. This could change drastically tonight though, especially if we get a dovish message littered with warnings of risks to the economy.”

In corporate news, Apple shares were up nearly 6% in pre-market trade.

It was a very different story for Twitter, however, whose shares tumbled in pre-market trade after the social media giant reported disappointing earnings for the second quarter late on Tuesday.

Boeing and Coca-Cola were among the companies due to report before the open, while Facebook and Whole Foods will release earnings after the close.

On the data calendar, US durable goods orders are at 1330 BST and pending home sales at 1500 BST, while the Fed’s rate announcement is at 1900 BST.