US stock markets were buoyed by the technology sector as reporting season gets underway. However, it was all about a number of macro drivers overnight.
Tapering threat
The notes from the Federal Reserve meeting confirmed that they had all but agreed on tapering bond purchases from November and potentially above the US$15 billion per month rate; whether they do is another question.
Consumer price data was also released showing inflation remains elevated, jumping another 0.4% in September. This takes the annual rate to 5.4%, but closer to 4.0% when more volatile food and energy prices are excluded.
Whilst many will see this as persistent, six months is barely long enough to register.
The result was the Nasdaq leading the way, up 0.7% as investors flocked to companies most able to pass costs onto consumers, with the S&P 500 up 0.3% and the Dow Jones flat.
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JP Morgan earnings out, Apple cuts production
Elsewhere, JP Morgan (NYSE: JPM) sent the financials sector lower despite reporting a record level of investment banking fees, which were 52% higher amid a boom in M&A. JPMorgan shares fell 2.6% as investors were concerned about anaemic loan growth.
Meanwhile, Apple (NASDAQ: AAPL) shares also fell slightly after reports suggested its production of iPhone 13 units would be slowed by the chip shortage. According to Bloomberg, Apple is likely to slash its projected iPhone 13 production targets for 2021 by as many as 10 million units.
US stock market movers
Here’s how other popular US stocks fared on Wednesday.
- Sea (NYSE: SE) up 7.5%
- Crowdstrike (NASDAQ: CRWD) up 7.0%
- Twilio (NYSE: TWLO) up 5.9%
- Monster Beverage (NASDAQ: MNST) down 3.0%
- American Express (NYSE: AXP) down 3.5%
- Align Technology (NASDAQ: ALGN) down 5.0%
Back home on the ASX, the S&P/ASX 200 (ASX: XJO) is set to follow US markets higher at the open this morning. For a round-up of the latest news, check out my ASX 200 morning report.
