Apple powers Wall Street at open as all eyes on US Fed statement

Apple shares soared 7.4 per cent to US$104.47 after the company sold more iPhones than expected in the third-quarter.
Apple shares soared 7.4 per cent to US$104.47 after the company sold more iPhones than expected in the third-quarter. PHOTO: REUTERS

WASHINGTON (REUTERS) - Wall Street was trading higher on Wednesday morning, bolstered by strong results from Apple, and ahead of the Federal Reserve's decision on interest rate hikes.

Apple shares soared 7.4 per cent to US$104.47 after the company sold more iPhones than expected in the third-quarter and gave an upbeat current-quarter forecast. The stock boosted all three major indexes and helped the S&P 500's information technology index rise 1.1 per cent, outpacing the other 10 major sectors.

The Fed is expected to keep rates unchanged as it wraps up its two-day policy meeting with a statement later in the day.

Investors will look for clues on the timing of the next rate hike as the recent set of strong economic data could make a case for an increase in the coming months. Traders have priced in a 19.5 per cent chance of a rate increase in September and a 42.8 per cent chance in December, according to CME Group's FedWatch tool.

"The outcome of the Fed's meeting is pretty much baked into the cake today, but the language it uses may cause some movement after that point," said Mark Heppenstall, chief investment officer at Penn Mutual Asset Management.

At 9:38 a.m. ET (9.38 p.m Singapore time) the Dow Jones Industrial Average was up 59.99 points, or 0.32 per cent, at 18,533.74. The S&P 500 was up 3.38 points, or 0.16 per cent, at 2,172.56. The Nasdaq Composite index was up 32.44 points, or 0.63 per cent, at 5,142.49.

Global stocks got a boost after Japan Prime Minister Shinzo Abe unveiled a US$265 billion stimulus package to reflate the country's economy. Of the 157 S&P 500 companies that have reported results so far, 69 per cent have topped earnings estimates.