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Wall Street Savors Earnings Ahead Of FOMC Decision


Earnings optimism is driving futures higher, as signaled by the U.S. index futures, which point towards a higher open on Wall Street on Wednesday. After Apple (AAPL) warmed the Street with its stellar second quarter results, traders look ahead to another slew of earnings reports, including those from Boeing (BA) and Caterpillar (CAT). Earlier in the day, a statistical report showed that the U.K. economy re-entered the recession territory.

Main Street events are also likely to be on the investor radar, with traders likely to closely track the Federal Open Market Committee's post-meeting policy statement, updated forecasts from the central bank and Chairman Ben Bernanke's press briefing. The durable goods orders report to be released shortly before the markets open may also impact market mood.

As of 6:30 am ET, the Dow futures are adding 68 points, the S&P 500 futures are moving up 9.50 points and the Nasdaq 100 futures are tacking 50.25 points.

U.S. stocks closed Tuesday's session on a mixed note, as bargain hunting on the back of some positive earnings reports and successful European debt auctions offset economic worries.

The FOMC is due to release the post-meeting policy statement at 12:30 am ET followed by the release of the FOMC forecasts at 2 pm ET. Bernanke will address a press briefing at 2:15 pm ET.

Ahead of the FOMC announcement, the Commerce Department is set to release its durable goods orders report at 8:30 am ET. Economists expect a 1.5 percent drop in durable goods orders for March. Excluding transportation, orders may have risen 0.4 percent.

The Energy Information Administration is scheduled to release its weekly petroleum inventory report for the week ended April 20th at 10:30 am ET.

In corporate news, Apple (AAPL) blew past estimates in its fiscal year second quarter and, as has been its wont, issued a cautious guidance.

Chinese search engine Baidu (BIDU) issued lackluster revenue guidance for the full year, signaling that it will experience a slowdown in revenue growth. That said, the company reported better than expected first quarter results.

Unisys' (UIS) first quarter results were ahead of estimates. International Gaming Technology (IGT) reported better than expected second quarter results and also raised its 2012 earnings per share guidance. Railroad operator

Norfolk Southern (NSC) reported better than expected first quarter results.
Amgen (AMGN) announced a deal to buy a 95.6 percent stake in Turkish biotech firm Mustafa Nevzat for $700 million. Separately, the company reported better than expected first quarter results but trimmed its 2012 earnings per share outlook, which however surrounds the consensus estimate.

Akamai Technology (AKAM), Crocs (CROX), Emulex (ELX), Equity Residential (EQR), Everest Re (RE), Fidelity National (FNF), Intersil (ISIL), Knight Transportation (KNX), Las Vegas Sands (LVS), LSI Logic (LSI), NETGEAR (NTGR), Owens-Illinois (OI), Terex (TEX), Waste Connections (WCN), Williams Companies (WMB) and Xilinx (XLNX) are among the important companies due to release their quarterly results after the markets close.

The major Asian markets closed on a mixed note, with the Japanese market rebounding from four sessions of losses, while the Hong Kong, Indian, Indonesian, Malaysian and South Korean markets retreated. The Australian and New Zealand markets remained closed on account of a public holiday. Solid U.S. tech earnings offered some support even as the eurozone debt concerns and economic worries lingered.

Japan's Nikkei 225 advanced 92.97 points or 0.98 percent before closing at 9,561, with tech stocks rallying strongly in reaction to Apple's strong results. Meanwhile, Hong Kong's Hang Seng Index declined 30.87 points or 0.15 percent before closing at 20,646. India's Sensex shed about 0.30 percent after Standard & Poor's lowered its rating outlook on India to 'negative.'

The major European markets are adding on to their yesterday's gains, aided by some positive earnings reports.

In corporate news, German software maker SAP (SAP) reported better than expected first quarter results. The company also said it expects non-IFRS software and software -related service revenue to increase in the range of 10-12 percent for the full year and 14-16 percent for the second quarter.

Ericsson's (ERIC) first quarter operating income, excluding joint venture and Sony Ericsson sale, fell to 2.8 billion Swedish Kronor per share as sales slipped 4 percent to 51 billion Swedish Kronor.

Swedish white goods giant Electrolux reported first quarter core earnings that came in ahead of estimates, while the company also said it expects better results for the second half of the year. Meanwhile, Siemens (SI) lowered its full year earnings outlook due to delays in its wind power projects. The company also reported a decline in its second quarter earnings. Credit Suisse (CS) reported a surprise profit for its first quarter.

Preliminary first quarter GDP estimates released by the U.K. Office for National Statistics showed that the U.K. economy contracted by 0.2 percent sequentially compared to expectations for a 0.1 percent expansion. The contraction, the second in succession, has pushed the economy into a technical recession.

by RTTNews Staff Writer

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