U.S. stock indexes looked set to open higher on Wednesday with the Dow Industrials on course to breach the 22,000 mark, driven by a rally in Apple’s shares.
Apple (AAPL.O) jumped 6.53 percent in premarket trading, a day after the world’s largest publicly listed company reported strong results and iPhone sales, and signaled its upcoming 10th-anniversary phone is on schedule. The stock is up about 30 percent this year.
The S&P 500 information technology index .SPLRCT is up 22 percent year to date, leading other sectors, as investors look for growth in an otherwise low-growth environment.
The Dow has risen 11 percent in 2017, even as Wall Street is losing confidence that President Donald Trump and a Republican-controlled Congress would be able to cut taxes and increase infrastructure spending this year.
The Dow hit the 20,000 mark in late January and crossed the 21,000 mark in just over a month on March 1, helped by a rise in banks Goldman Sachs (GS.N) and JPMorgan (JPM.N).
“Investors are completely immune to all the drama which is taking place in Washington because if you look at the performance of the Dow, it appears everything is hunky-dory,” said Naeem Aslam, chief market analyst at Think Markets UK.
“In earnings, it is all about Apple. The big news was about the production of iPhone 8, the flagship product for the firm will hit the market on time with no issues around production.”
Two-thirds of S&P 500 companies have reported their second-quarter earnings so far and 72 percent of them have beaten Wall Street’s expectations, according to Thomson Reuters I/B/E/S. In a typical quarter, 64 percent of the companies beat expectations.
The results may reassure investors worried about high valuations. The S&P 500 is trading at about 18 times earnings estimates for the next 12 months, above its 10-year average of 14 times, according to Thomson Reuters Datastream.
Dow e-minis 1YMc1 were up 46 points, or 0.21 percent, with 15,786 contracts changing hands at 8:17 a.m. ET (1217 GMT).
S&P 500 e-minis ESc1 were up 1.75 points, or 0.07 percent, with 112,883 contracts traded.
Nasdaq 100 e-minis NQc1 were up 44 points, or 0.75 percent, on volume of 34,467 contracts.
Data showed U.S. private employers added 178,000 jobs in July, after adding 191,000 jobs in June. Economists polled by Reuters expected an addition of 185,000 jobs. The data comes ahead of the more comprehensive non-farm payrolls data on Friday.
Garmin (GRMN.O) rose 7.72 percent and FireEye (FEYE.O) 7.56 percent after both companies reported strong quarterly results.
Time Warner Inc (TWX.N) was up 0.86 percent, after its quarterly profit got a lift from the success of its superhero movie “Wonder Woman”.
Humana (HUM.N) rose 2.27 percent as the health insurer reported a better-than-expected quarterly profit.
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