Midday Market Update: Tech Dips, Fedex Surges

Stocks were rising Wednesday, despite big tech’s falter by midday. 

The S&P 500 was up 0.33%, even with many large-cap tech components of the Nasdaq down, as the Nasdaq was down 0.18% by midday. It was up 0.3% in the morning. The 10-Year Treasury yield was flat at 0.67%. 

The yield hasn’t been able to rise of late, as the Federal Reserve’s new policy — while inflationary in theory — promises that long-term rates will remain low even when inflation does begin to run hot. This is also highly supportive of stocks. 

Facebook  (FB) – Get Report was down 2%, as the Federal Trade Commission reportedly prepares an antitrust case against the company. Google  (GOOGL) – Get Report shares fell 0.5% 

Positively, Fedex  (FDX) – Get Report wiped the floor clean on revenue and earnings, posting a $19 billion revenue result that exceeded estimates by 10%. Management said global and U.S. shipment volumes partially carried the company for the quarter. 

The stock rose 6%. This bodes well for consumer and broader economic demand, potentially one factor powering the S&P 500 Equal Weight Consumer Discretionary Index to a 1.1% gain. Still, the market was well aware that second quarter earnings, which are mostly over with, have beaten estimates, pointing to a faster economic and earnings rebound than previously expected, although the magnitude of the beat is hard to ignore. 

While some consumer discretionary stocks, many of which are taking at expensive valuations even compared to ultra-low interest rates, were mixed in the morning, more of them were up by midday. 

Oil, manufacturing and banking stocks were all up considerably, contrary to the morning’s movements. 

The Federal Reserve announces new information on monetary policy Wednesday and while interest rates cannot fall much from here, investors will be keying into the commentary on the economy and guidance on the speed of the economic recovery. 

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