U.S. stocks edged higher on Wednesday as investors digested a heavy slate of corporate earnings, robust economic data, and awaited the latest Federal Reserve policy decision.
At 09:40 ET, the Dow Jones Industrial Average rose 20 points, or 0.1%, while the S&P 500 gained 7 points, or 0.1%, and the Nasdaq Composite advanced 45 points, or 0.2%.
Mega-Cap Tech Earnings in Focus
This week marks the busiest stretch of the earnings season, with 199 S&P 500 companies having reported so far. Nearly 82% have topped profit estimates, according to FactSet.
Wednesday brings the first wave of results from the “Magnificent Seven” mega-cap tech names. Meta Platforms (NASDAQ:META) and Microsoft (NASDAQ:MSFT) are set to report after the bell, followed by Apple (NASDAQ:AAPL) and Amazon (NASDAQ:AMZN) on Thursday. Other companies posting results include Arm Holdings (NASDAQ:ARM) and Robinhood Markets (NASDAQ:HOOD).
Beyond tech, Starbucks (NASDAQ:SBUX) surged after its third-quarter revenue beat forecasts, signaling progress in its turnaround plan. Humana (NYSE:HUM) climbed after lifting its annual revenue guidance, while Etsy (NASDAQ:ETSY) gained on stronger-than-expected sales, supported by personalized marketing and AI initiatives. VF Corporation (NYSE:VFC) also rallied after surpassing revenue estimates, driven by solid apparel and footwear demand.
Trade Talks Remain a Headwind
Investor sentiment was dented slightly after two days of U.S.-China trade talks in Sweden ended without a breakthrough. Both sides described the discussions—aimed at extending their 90-day trade truce—as “constructive,” but no major progress was achieved.
Adding to trade tensions, President Trump announced a 25% tariff plus penalties on India, effective August 1, citing its purchases of Russian military equipment and energy. This comes just days after Trump reached a framework trade agreement with the European Union, while negotiations with other countries remain unresolved ahead of the August 1 tariff deadline.
Fed Policy Meeting to Wrap Up
The Federal Reserve will conclude its July meeting later today and is widely expected to keep interest rates unchanged at 4.25%-4.5%. Chair Jerome Powell and other Fed officials have signaled a more cautious approach to future rate moves, wanting to assess the economic impact of Trump’s aggressive tariff strategy.
The White House has been pressuring the Fed to cut rates to bolster growth, a demand intensified by the latest economic reports. Data released Wednesday showed the U.S. economy grew at an annualized 3.0% in the second quarter, beating forecasts for 2.5% and rebounding from a 0.5% contraction in Q1. Additionally, private payrolls increased by 104,000 in July, sharply higher than expected, following a revised 23,000 decline in June. These figures precede Friday’s closely watched nonfarm payrolls report.
Oil Prices Extend Gains
Crude prices climbed again Wednesday, building on sharp gains from the previous session. At 06:00 ET, Brent crude was up 0.6% at $72.11 a barrel, while West Texas Intermediate (WTI) rose 0.7% to $69.70. Both benchmarks settled Tuesday at their highest levels since June 20, jumping more than 3% after President Trump warned of additional measures against Russia if it fails to make progress on ending the war in Ukraine.
This content is for informational purposes only and does not constitute financial, investment, or other professional advice. It should not be considered a recommendation to buy or sell any securities or financial instruments. All investments involve risk, including the potential loss of principal. Past performance is not indicative of future results. You should conduct your own research and consult with a qualified financial advisor before making any investment decisions.
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