Investing.com — U.S. stocks edged higher Wednesday, bouncing after the previous session’s weakness with investors assessing more corporate results during a generally positive quarterly earnings season.
At 09:35 ET (13:35 GMT), the Dow Jones Industrial Average gained 50 points, or 0.1%, the S&P 500 index rose 11 points, or 0.2%, and the NASDAQ Composite climbed 65 points, or 0.3%.
The main averages fell in the prior session, amid concerns about the health of the U.S. economy, especially in the wake of Friday’s weak jobs data.
Solid earnings season continues
The second-quarter earnings season is approaching its conclusion, and more than 80% of firms who have reported so far have beaten expectations.
A number of the companies in the blue-chip DJIA index have reported Wednesday, including McDonald’s (NYSE:MCD), with the burger giant’s global sales beat expectations for the second quarter, as affordable meal bundles and promotions drew in budget-conscious diners.
Walt Disney (NYSE:DIS) reported revenue from conventional TV networks and sports programming that fell short of Wall Street’s expectations, despite a strong performance from the company’s theme parks and streaming businesses.The media conglomerate’s ESPN sports broadcasting empire said it would launch a new direct-to-consumer streaming service on August 21.
Elsewhere, Spotify Technology (NYSE:SPOT) stock soared after the e-commerce company forecast third-quarter revenue above market estimates, as its AI features and platform upgrades boosted demand for its e-commerce services despite tariff-related uncertainty pressuring retail businesses.
Capri Holdings (NYSE:CPRI) stock climbed strongly after the fashion company posted a smaller-than-expected drop in quarterly revenue, helped by improving demand for its luxury handbags and footwear despite a broader retail slowdown.
Advanced Micro Devices (NASDAQ:AMD) stock fell after the chipmaker unveiled underwhelming quarterly revenue at its crucial data center business, especially when compared with AI-darling Nvidia (NASDAQ:NVDA).
Snap (NYSE:SNAP) shares plummeted as the social media company reported a weak quarter as mounting competition underscored the company’s struggle to keep pace with AI-driven peers.
Rivian Automotive (NASDAQ:RIVN) also struggled after the electric vehicle company’s second-quarter loss was worse than expected amid trade-related supply chain disruptions.
Economic weakness prompted concerns
Yet, despite the solid earnings, stocks have been mostly under pressure this week on concerns that the Trump administration’s volatile trade policies will hit economic activity in the world’s largest economy.
The Institute for Supply Management’s non-manufacturing purchasing managers’ index unexpectedly fell to a reading of 50.1 in July from 50.8 in the prior month, a disappointment given services make up about 80% of economic growth.
At the same time a gauge of input costs paid by these firms surged to its highest level in almost three years — fueling worries that the U.S. may be entering a period of tepid growth and elevated price gains, known as “stagflation.”
This economic weakness has raised expectations of a rate cut by the Federal Reserve in September, especially after last week’s weak payrolls data and comments from San Francisco Fed President Mary Daly, who signaled openness to a September cut.
There’s little in the way of first tier economic data due Wednesday, but investors will be monitoring comments from a series of Fed members later in the session, including Susan Collins, Lisa Cook as well as Daly once more, for clues about the U.S. central bank’s likely interest rate path going forward.
Crude rebounds
Oil prices rose Wednesday, rebounding from the previous session’s five-week low in the previous day with the prospect of tighter U.S. sanctions against the buyers of Russian oil offering some support.
At 09:35 ET, Brent futures gained 1.8% to $68.83 a barrel, and U.S. West Texas Intermediate crude futures rose 1.8% to $66.36 a barrel.
Both benchmarks fell by more than $1 a barrel on Tuesday to settle at their lowest in five weeks, marking a fourth session of losses, on oversupply concerns from OPEC+’s planned September output hike.
Trump on Tuesday kept up his threats of increasing trade tariffs against India, over New Delhi’s continued purchase of Russian oil, saying he will impose additional tariffs on India this week, after slapping the country with 25% tariffs last week.
API data showing a substantially bigger-than-expected draw in U.S. oil inventories last week–4.2 million barrels, against expectations for a 1.8 million barrel draw–also offered support.
Ayushman Ojha contributed to this article