US open: Stocks in the black after Apple earnings; Fed eyed

US stocks opened in the black on Wednesday as investors welcomed encouraging earnings from technology giant Apple ahead of the Federal Reserve’s latest rate announcement.

At 1440 BST, the Dow Jones Industrial Average was up 0.3%, the S&P 500 was 0.1% firmer and the tech-heavy Nasdaq was 0.6% stronger.

At the same time, oil prices were mixed. West Texas Intermediate was up 0.1% at $42.95 a barrel and Brent crude was 0.6% higher at $44.61.

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 7% in early trade after its third-quarter earnings late on Tuesday beat estimates. The company reported earnings per share of $1.42 and revenues of $42.4bn and said it sold 40.4m iPhones, which was a touch ahead of forecasts for 40.02.

Boeing was also in the black despite reporting its first quarterly loss in nearly seven years.

It was a very different story for Twitter, however, which tumbled after the social media giant reported disappointing earnings for the second quarter late on Tuesday.

Coca-Cola shares were under pressure after the drinks company’s quarterly revenue missed expectations.

Still to come, Facebook and Whole Foods will release earnings after the close.

Figures from the Commerce Department showed US durable goods orders fell more than expected in June.

Durable goods orders were down 4% on the previous month to $219.8bn following a 2.8% drop in May. Economists had been expecting a 1.1% drop.

Excluding transport, new orders declined 0.5%, missing expectations of a 0.3% increase. They were down 3.9% excluding defence.