New York City, New York – (StockNewsDesk) – 10/20/2014 — Broad indices of the US markets may stay mixed as today’s movement is dependent on the earnings of bellwether companies. However, the S&P 500 has managed to stay in the green in anticipation that Apple’s results will overshadow IBM’s disappointing one. Friday’s massive rally regained investor confidence around the globe. Global indices came off 8-month lows, and fears of a global slowdown abated as third-quarter earnings came in better than expected, and the European government decided to introduce a stimulus package.
Important dignitaries of the Federal Reserve have given speeches with an intention to throw some light on the future of the bond-buying program. Last week, the speech was given by James Bullard, Federal Reserve President of St Louis. He suggested there is a chance that the government may extend its bond-purchase programme through October so there are no jerks in the financial world. On Friday, Federal Reserve chairwoman Janet Yellen gave a speech in Boston.
The Fed Chair expressed concerns over the continuous increase in the inequality. Today, all focus will be on Jerome Powell, a Fed Governor. Today he might show a blueprint on what steps the Central Bank might take over the coming weeks. The bond-purchase programme will affect the financial markets, as a continuation of the program will boost investor optimism while curbing it might cause turmoil in the financial world.
Right now, all eyes are on Apple’s third-quarter results. Investors expected the company to post better than expected results. Apple is expected to post earnings of $1.30 a share. IBM, another technology bellwether, failed to meet the Street’s expectation. IBM earned $3.68 a share, compared to expectations of $4.32 a share. IBM could not post profits as it is in the midst of a transition. IBM has literally no presence in mobile while it is in the development phase to gain ground in the cloud business. In such a situation the company will take time to gear up and boost profits.
According to the data provided by the Thomson Reuters, 81 of the S&P 500 companies have posted results of which 64% of them have posted profits above the Street’s expectations. This is higher than the average of 63% since 1994, however, lower than the past four quarters’ average of 67%. Apple’s result will prove to a trend decider for the short-term while the bond-purchase program will influence the larger picture.