Markets are called to open higher this morning.
It was a ‘no news is good news’ kind of day for the stock market.
After waiting on the sidelines most of Wednesday in anticipation of the Federal Reserve’s statement and Fed chief Ben Bernanke’s first press conference, investors waded back in.
As expected, the central bank said it would keep interest rates low and end its $600 billion Treasury buying program in June, while Bernanke reassured investors that the nation’s economic recovery is on track.
“The Fed statement and Bernanke’s speech didn’t offer any surprises, and that’s good for the market because Wall Street hates uncertainty,” said Doug Roberts, chief investment officer at Channel Capital Research and author of Follow the Fed to Investment Success.
The lack of news pushed the Dow Jones industrial average (INDU) up 96 points, or 0.8%. The S&P 500 (SPX) rose 8 points, or 0.6%, and the Nasdaq Composite (COMP) added 22 points, or 0.8%.
The gains put all three indexes at fresh multi-year highs. The Dow climbed to its highest level since May 2008, while the S&P 500 rose to its highest level since June 2008. The Nasdaq pushed to its highest level since December 2000.
With the Fed’s meeting on top of this week’s onslaught of corporate earnings and economic reports, “investors have a lot to digest,” said Fred Dickson, chief market strategist at D.A. Davidson & Co.
Asian stocks rose, with the regional benchmark index heading for a two-month high, after the Federal Reserve renewed its pledge to stimulate U.S. economic growth with low interest rates and as companies from Advantest Corp. (6857) and Komatsu Ltd. (6301) posted higher earnings.
Events this Week
Thursday: Before the start of trading, Exxon Mobil (XOM, Fortune 500) is expected to deliver a $10 billion profit, up 60% from a year ago, on revenue of $115 million.
PepsiCo (PEP, Fortune 500), Procter & Gamble and Sprint Nextel (S, Fortune 500) will reveal their quarterly earnings in the morning too.
Also on tap: The Department of Commerce will release its initial reading on economic growth during the first three months of the year. Economists expect the economy expanded at a rate of 1.7% during the first quarter.
Weekly initial claims data is due as well. Claims are expected to fall back to 390,000 in the latest week, after hovering above the key 400,000 level for two consecutive weeks.
Later in the morning, a report from the National Association of Realtors is expected to show a 1.5% rise in pending home sales for the month of March.
After the closing bell, analysts expect Microsoft will post a quarterly profit of $4.8 billion, up 20% from a year ago, on sales of $16.2 billion.
Friday: Dow components Caterpillar (CAT, Fortune 500), Chevron (CVX, Fortune 500) and Merck (MRK, Fortune 500) are all on tap to delivery quarterly results prior to Friday’s opening bell.
Investors will also digest data on personal income and spending before the start of trading.
Shortly after the bell, investors will get the April reading of Chicago PMI, a regional manufacturing index, and the final April reading on consumer sentiment from the University of Michigan.