#PreMarket Primer: Thursday, June 19: US Stocks Soar As Fed Recommits To Accommodative Policy

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US stocks rose to new highs on Wednesday after the US Federal Reserve recommitted to an accommodative monetary policy and raised its outlook for the nation's economy.

Following a two day policy meeting, Fed Chair Janet Yellen announced that the bank saw short-term interest rates improving through 2016, but saw reduced growth in the long run.

Yellen cited an improving labor market and lower household debt as reasons to expect faster growth over the next two years.

The bank also met expectations and continued with its tapering schedule by reducing its monthly asset purchases by a further $10 billion, proving that the region's economy was gaining the strength needed to stand on its own.

Top News

In other news around the markets:

On Wednesday, a chain of emails between General Motors employee Laura Andres and the company's engineers indicated that the company ignored warnings from 2005 about the ignition switch problem. Andres noticed the problem when her own Chevrolet Impala shut off after hitting a bump and alerted engineers of her concern. However, her complaint fell on deaf ears as the company only just recalled those vehicles this week. With Iraq on the verge of a civil war, the White House is pushing for the nation to create a new government that would include representation from both the Sunni and Kurdish communities as the nation's current Shiite leader Prime Minister Nouri al-Maliki seems unable to unite the nation's minority groups. The Obama administration has said that a government which gives a voice to the minority groups could prevent them from supporting radical movements like the Islamic state of Iraq and al-Sham, which is responsible for the latest outbreak of violence. Although Russian President Vladimir Putin and his Ukrainian counterpart Petro Poroshenko have been reportedly discussing a cease fire in eastern Ukraine, the fighting continued on Thursday as both pro-Russian separatists and the Ukrainian military clashed near the town of Krasny Liman. Reuters reported that military sources have said the scale of this battle far exceeds that of any other clash thus far in the conflict. Shares of clothing retailer American Apparel  lost ground on Wednesday after the company's board announced its intent to fire Chief Executive and founder Dov Charney. The board has not yet released the details of the move, but said that Charney is being accused of "misconduct." Charney's contract obligates the board to wait for a 30 day period before finalizing the decision.

Asian Markets

Asian markets were mixed; the NIKKEI and the KOSPI gained 1.62 percent and 0.13 percent respectively, while the Shenzhen composite lost 2.33 percent and the Shanghai composite fell 1.55 percent.

European Markets

European markets were off to a good start; the UK's FTSE gained 0.67 percent, the eurozone's STOXX 600 rose 0.61 percent, Italy's MIB gained 1.05 percent, the German DAX gained 0.80 percent and the French CAC 40 rose 0.76 percent.

Commodities

Energy futures were higher as the crisis in Iraq continued to worsen, Brent crude oil futures were up to $114.24 per barrel while WTI traded at $106.21 per barrel. Gold and silver were up 0.65 percent and 0.84 percent respectively and industrial metals also rose across the board. Copper gained 0.03 percent, zinc was up 0.56 percent, and aluminum had the largest gains, up 1.13 percent.

The euro gained momentum against the dollar following the Fed meeting, up 0.31 percent. The common currency also rose 0.13 percent against the pound and 0.16 percent against the yen. The dollar retreated, down 0.14 percent against the yen, 0.19 percent against the pound and 0.35 percent against the franc.

Earnings

Notable earnings released on Wednesday included:

FedEx (NYSE: FDX ) reported fourth quarter EPS of $2.46 on revenue of $11.80 billion, compared to last year's EPS of $2.13 on revenue of $11.44 billion. Red Hat (NYSE: RHT ) reported first quarter EPS of $0.34 on revenue of $424.00 million, compared to last year's EPS of $0.32 on revenue of $363.26 million. Jabil Circuit (NYSE: JBL ) reported a third quarter loss of $0.06 on revenue of $3.79 billion, compared to last year's EPS of $0.56 on revenue of $4.47 billion. Actuant Corporation (NYSE: ATU ) reported third quarter EPS of $0.70 on revenue of $378.19 million, compared to last year's EPS of $0.62 on revenue of $344.20 million.

Stocks moving in the Premarket included:

Apple (NASDAQ: AAPL ) gained 0.41 percent in premarket trade after rising 0.11 percent on Wednesday. Transocean Ltd. (NYSE: RIG ) was down 0.49 percent in premarket trade after rising 2.56 percent over the past five days. Microsoft (NASDAQ: MSFT ) fell 0.41 percent in premarket trade after gaining 2.64 percent over the past week. Facebook (NASDAQ: FB ) was down 0.35 percent in premarket trade after rising 1.86 percent on Wednesday.

Notable earnings expected on Thursday include:

Kroger Company (NYSE: KR ) is expected to report first quarter EPS of $1.05 on revenue of $32.57 billion, compared to last year's EPS of $0.92 on revenue of $30.04 billion. Oracle Corporation (NYSE: ORCL ) is expected to report fourth quarter EPS of $0.95 on revenue of $11.48 billion, compared to last year's EPS of $0.87 on revenue of $10.95 billion. BlackBerry (NASDAQ: BBRY ) is expected to report a first quarter loss of $0.25 on revenue of $969.56 million, compared to last year's loss of $0.13 on revenue of $3.07 billion. Rite Aid (NYSE: RAD ) is expected to report first quarter EPS of $0.05 on revenue of $6.43 billion, compared to last year's EPS of $0.09 on revenue of $6.29 billion.

Economics

Thursday's economic calendar will be relatively quiet with notable releases including US initial and continuing jobless claims, British retail sales, and the US CB leading index.

For a recap of Wednesday's market action, click .

Tune into Benzinga's #PreMarket Prep today to hear Jeff Pierce, Meisa Bonelli and Rev. Emmanuel Lemelson  here !

© 2014 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Commodities , Futures , International

Referenced Stocks: AAPL , MSFT , ORCL , ATU , FDX

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