Why U.S. Stocks Are Trading Higher Ahead Of Fed Decision; Alphabet Earnings Miss Views

U.S. stocks traded higher this morning, with the Nasdaq Composite gaining around 250 points on Wednesday.

Following the market opening Wednesday, the Dow traded up 0.41% to 31,892.38 while the NASDAQ rose 2.16% to 11,808.12. The S&P also rose, gaining, 1.12% to 3,965.14.

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Leading and Lagging Sectors

Communication services shares rose 3.2% on Wednesday. Meanwhile, top gainers in the sector included Leafly Holdings, Inc. LFLY, up 32% and Spotify Technology S.A.. SPOT up 16%.

In trading on Wednesday, materials shares fell 1.2%.

Top Headline

Alphabet Inc. GOOGL reported downbeat earnings for its second quarter on Tuesday. However, revenue for the company’s Search and Other segment was $40.7 billion, up 13.7% year-over-year.

Equities Trading UP

Blue Water Vaccines, Inc. BWV shares shot up 70% to $3.4902. Blue Water Vaccines recently announced signing of sponsored research agreement with Cincinnati Children's Hospital Medical Center for S&P vaccine platform development.

Shares of Pzena Investment Management, Inc PZN got a boost, shooting 46% to $9.40 as the company said it has entered into an agreement to become a private company. The company also reported a rise quarterly sales.

AlloVir, Inc. ALVR shares were also up, gaining 19% to $5.49 after the company announced a registered direct offering of 27.5 million shares at $4.61 per share.

Equities Trading DOWN

F45 Training Holdings Inc. FXLV shares tumbled 75% to $0.8840 after the company cut its FY22 sales guidance to below analyst estimates. Macquarie and Baird downgraded the stock to Neutral.

Shares of Cassava Sciences, Inc. SAVA were down 28% to $15.59. The U.S. Justice Department has opened a criminal investigation into Cassava Sciences on whether it manipulated research results for its investigational Alzheimer's drug, Reuters reported citing two people familiar with the inquiry.

Turning Point Brands, Inc. TPB was down, falling 18% to $24.47 after the company released financial results for the second quarter ended June 30, 2022, revealing net sales decreased 16.1%, compared to Q2 2021 to $102.9 million.

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Commodities

In commodity news, oil traded up 1.1% to $96.00, while gold traded down 0.3% to $1,712.90.

Silver traded down 0.7% to $18.41 on Wednesday while copper rose 0.7% to $3.4080.

Euro zone

European shares were higher today. The eurozone’s STOXX 600 rose 0.5%, London’s FTSE 100 gained 0.6% while Spain’s IBEX 35 Index rose 0.7%. The German DAX gained 0.4%, French CAC 40 rose 0.6% and Italy’s FTSE MIB Index gained 1.2%.

Loans to households in the Eurozone increased 4.6% year-over-year in June. Italian consumer confidence fell to 94.8 in July from 98.3 a month ago, while manufacturing confidence declined to 106.7 in July from a revised 109.5. Consumer confidence in France declined for the seventh month running to 80 in July.

Economics

U.S. durable goods orders increased 1.9% from a month ago in June.

The goods gap in the US shrank to $98.2 billion in June from a revised $104 billion in May.

Wholesale inventories in the US rose 1.9% month-over-month to $896.0 billion in June.

Pending home sales in the US dropped 8.6% month-over-month in June, after rising 0.4% in May.

The Energy Information Administration’s weekly report on petroleum inventories in the U.S. will be released at 10:30 a.m. ET.

The Federal Reserve will announce its policy decision at 2:00 p.m. ET. The Fed is projected to increase its federal funds policy rate by 75 basis points for a second consecutive meeting.

Fed Chairman Jerome Powell will hold a press conference at 2:30 p.m. ET.

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COVID-19 Update

The U.S. has the highest number of coronavirus cases and deaths in the world, reporting a total of 92,494,010 cases with around 1,052,930 deaths. India confirmed a total of at least 43,938,760 cases and 526,160 deaths, while Brazil reported over 33,660,600 COVID-19 cases with 677,560 deaths. In total, there were at least 577,475,760 cases of COVID-19 worldwide with more than 6,407,980 deaths.