US Stocks Rise After Fed Rate Cut Hope and Earnings Data

U.S. stock indexes advanced on Friday as solid results from Microsoft lifted technology stocks and added to an upbeat mood following signs from New York Fed President John Williams that the central bank would lower interest rates this month.

Microsoft Corp (MSFT.O), America’s most valuable company, gained 2.2% as strength in its cloud business helped it beat analysts’ estimates at the end of a week of mixed corporate results.

The S&P technology sector .SPLRCT gained 0.60%, providing the biggest boost to the benchmark S&P 500 .SPX index.

“Some optimism is being carried forward from New York Fed President John Williams’ comments and largely better-than-expected corporate earnings so far, highlighted by Microsoft,” said Art Hogan, chief market strategist at National Securities in New York.

Second-quarter profits at S&P 500 companies are now estimated to rise 1%, according to Refinitiv IBES data, in a reversal from earlier expectations of a small drop.

Williams’ remarks that the Fed cannot wait for economic disaster to unfold and must add stimulus early were behind Thursday’s positive close.

via Reuters

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza