CBN News 2026-10-29 06:58:04

Author: Fan Zhijing Editor-in-Chief: Ge Weier

*The three major stock indices rose, with the Dow Jones index increasing by nearly 100 points;

U.S. stocks rose across the board on Wednesday as investors digested the Federal Reserve's latest interest rate decision and awaited financial reports from major technology companies. By the close of trading, the Dow Jones Industrial Average rose 97.53 points, or 0.19%, to 52,475.10; the Nasdaq Composite Index rose 0.27% to 26,549.85; and the S&P 500 Index rose 0.28% to 7,743.98.

Google and Microsoft release their financial reports

Google's parent company, Alphabet, reported revenue of $128.6 billion in the third quarter, a year-on-year increase of 24.9%, while analysts expected it to be $128.2 billion. Net profit was $37.33 billion, up 6.73% year-on-year. Due to accelerated cash consumption from large-scale AI expenditures, Google's stock price fell by about 9% in after-hours trading.

Google Cloud reported quarterly revenue of $21.05 billion, a year-on-year increase of 41%, with the growth rate significantly accelerating from 32% in the previous quarter. The growth in cloud business was mainly driven by the strong performance of Google Cloud Platform ( GCP ), among which AI infrastructure and generative AI solutions made significant contributions.

Alphabet has raised its full-year capital expenditure forecast for 2026 to $125 billion to $130 billion, higher than the previous range of $120 billion to $125 billion. At the same time, capital expenditure in 2027 is expected to "significantly increase."

Microsoft's revenue and profits both exceeded analysts' expectations, mainly due to the strong growth of its cloud business. After the financial report was released, Microsoft's stock price rose by about 4% in after-hours trading.

Microsoft's total revenue for the third quarter increased by 19% year-on-year to $92.28 billion, 1.8% higher than analysts' expectations; operating profit also increased by 21% year-on-year to $45.92 billion, 5.4% higher than analysts' forecasts.

Cloud revenue increased by 30% year-on-year to $63.9 billion, 3.7% higher than market expectations; the revenue growth rate of the cloud computing platform Azure reached 48%, which is not only faster than the 43% in the previous quarter but also higher than the analysts' consensus forecast of 44.8%. During that quarter, the revenue of Azure exceeded $30 billion, about 3% higher than the market expectation of around $32.2 billion.

Microsoft's cash capital expenditure in the third quarter was $39.367 billion, a significant increase of 103% year-on-year, but it was clearly lower than analysts' expectations of $45.93 billion. Free cash flow was approximately $18.633 billion, which is about 27% lower than the $25.663 billion in the same period last year.

Market Overview

The Federal Reserve maintains the interest rate target range unchanged at 3.75% to 4%. Federal Reserve Chairman Jerome Powell stated at a press conference that despite the pause in interest rate hikes, the central bank remains focused on "price stability," and the employment situation is also "quite positive."

Long-term U.S. Treasury yields rose, with the benchmark 10-year Treasury yield increasing by 5.2 basis points to 5.044%, and the 30-year Treasury yield rising by 5.6 basis points to 5.360%. According to the FedWatch tool from the Chicago market, financial markets expect a 25-basis-point interest rate hike at the Federal Reserve's December meeting to be 85.0%, up from 78.3% on Tuesday.

Jeff Schultz, Chief Investment Strategist at Franklin Templeton Investments, stated: "Today's decision does not rule out another 25-basis-point interest rate hike before the end of the year. The key issue of concern for the market is the pace of tightening, and it seems that the committee is willing to gradually reverse last year's interest rate cuts at a steady pace, which is more favorable for risk assets in history."

There is a risk of escalation in the Middle East situation. According to reports from Huanqiu Net, the United States has informed several Gulf countries to prepare for a short but intense military operation that may unfold after the U.S. mid-term elections. The U.S. military is transporting a set of "Patriot" air defense systems from Texas to enhance their air defense capabilities and is moving troops from bases that may be exposed to Iranian fire. These signs indicate that the United States and Israel are preparing for a new round of attacks against Iran.

In response to the aforementioned reports, the White House stated that it would not comment on "sensitive military plans that may or may not exist," and also noted that "President Trump retains all options."

In recent weeks, due to financing issues, the stock prices of technology stocks, especially those companies involved in the construction of AI, have been performing poorly.

Bill Nossi, an investment director at Bank of America Asset Management Group, stated: "The short-term cycle is still very healthy. The key is whether it can maintain sustainability over the years and how the returns on the current large-scale investments will be. Will there be widespread profits, or will there be winners and losers? We tend to believe the latter."

Popular Stocks Performance

Star tech stocks saw more declines than gains, with only Google and Amazon rising. NVIDIA and Meta fell by over 1%.

The Philadelphia Semiconductor Index rose by more than 2%, achieving four consecutive daily gains. Boosted by the record quarterly profits of SK Hynix, the stock price of this South Korean chip manufacturer in the United States increased by 13%. Micron Technology rose by nearly 6%, Arm Holdings rose by 4%, and Marvell Technologies and AMD rose by 3%.

The optical communication sector strengthened, with Lumentum rising by 5.52%, Corning rising by 3.88%, and Coherent rising by 1.61%.

Oracle shares rose nearly 11%. The company provided revenue forecasts for the fiscal year 2030, expecting $225 billion, which represents an average annual growth of 35%. The company also stated that it will limit additional financing to $20 billion between the fiscal years 2027 and 2030.

Boston Scientific fell 5.8% after lowering its annual profit forecast.

The NASDAQ China Golden Dragon Index fell by 1.83%, NetEase fell by 1.44%, JD.com fell by 0.67%, Alibaba rose by 0.72%, and Baidu rose by 1.57%.

Large-cap performance

International oil prices have stabilized and rebounded, with the WTI crude oil near-month contract rising by 2.88% to $102.78 per barrel; the Brent crude oil near-month contract rose by 1.26% to $115.32 per barrel.

Affected by the Federal Reserve's decision, the precious metals market experienced significant volatility after hours. As of press time, COMEX gold futures for delivery in January next year on the New York Mercantile Exchange rose by 0.20% to $4082.73 per ounce; COMEX silver futures fell by 0.76% to $54.10 per ounce.