- Dow Jones rises on the day, thanks to Visa and Microsoft.
- The tech giants posted the biggest gains in their earnings reports.
- Bond yields are rising as the Fed is ambitious to raise the rates.
Wednesday morning, Visa and Microsoft lead the Dow Jones Industrial Average higher. About two-thirds of the blue-chip index’s daily gains come from Visa V, +8.20%, and Microsoft MSFT, +7.40%, while the Dow DJIA, +1.22%, was up 332 points 1.0%.
The Dow rose about 228 points due to about 8.6% in Visa shares and 6.4% in Microsoft shares. In addition, Salespeople Inc CRM contributed +3.71%, Caterpillar CAT contributed +1.79%, and Nike NKE contributed +2.06%. This sector has many companies with high share prices, which tend to move the market more up or down.
On Wednesday, the biggest tech companies posted one of their biggest gains. After reporting strong gains in its most recent quarter, shares of software giant Microsoft rose 7.2%. Meanwhile, Visa shares soared 8.7% after reporting a rise in earnings driven by increased spending for its eponymous credit card network.
The latest results of large communication companies are also reported. After reporting the slowest quarterly revenue growth since 2020, Alphabet, Google’s parent company, fell 2.2%.
On Wednesday, Facebook’s parent company, Meta Platforms, will announce its findings. Apple and Twitter will announce their results on Thursday.
In addition to industrial companies and retailers, investors focused on their profits. The shares of Boeing fell 6.2% after the company reported losses that far exceeded Wall Street’s expectations. Conversely, Chipotle’s stock rose 2.5% after reporting strong financial results.
In addition to raising interest rates aggressively, the Federal Reserve will intensify its anti-inflation efforts. Starting next week, the Fed chair may hike short-term interest rates by double the usual amount. The overnight interest rate has already been raised once since 2018.
Over the year, bond yields rose as investors awaited higher interest rates. Towards the end of Tuesday, the 10-year Treasury yield was 2.79%, up from 2.77%.
As a result of Russia’s war on Ukraine and the pandemic virus, Wall Street focuses on inflation’s future.
After Russia announced it would stop supplying Poland and Bulgaria with gas, natural gas prices in Europe rose 24% over the past day. As the pandemic eased and demand picked up, natural gas and oil prices were already rising, but the Russian invasion of Ukraine caused the price spike to escalate. As a result, prices of crude oil and natural gas rose sharply in 2022, making gas and heating more expensive for consumers.
Dow Jones technical analysis:
The Dow Jones index has gained on the day. The 4-hour chart shows a strong bullish candle. However, the gains lack the conviction to trigger a bullish reversal.
