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Midday Market Update

Stocks Up Ahead of Fed Statement

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U.S. Market    
Stocks followed overseas markets higher Wednesday as concerns eased about a eurozone bank run. Much focus will also be on the statement released after the Federal Open Market Committee ends its two-day meeting this afternoon. 

As reported yesterday, the European Central Bank's announcement that it would provide as-needed liquidity to Cyprus along with the parliament's rejection of the bailout helped calm fears of potential widespread withdrawals across the eurozone. The European Commission stated today that Cyprus now must create its own proposal to maintain its debt payments. 

At midday, the Dow and the Nasdaq had gained 0.4%, and the S&P 500 was 0.5% higher. 

Stocks on the Move
 FedEx (FDX) posted a 31% drop in third-quarter profit, with adjusted earnings per share coming in below the company's expectations. Revenue improved by 4% to $11 billion, slightly ahead of Wall Street forecasts, but the firm still experienced weakness on the international front and lowered its full-year EPS outlook. Shares sank by nearly 6%. 

 General Mills (GIS) posted a 1.8% increase in third-quarter earnings and a 7.5% year-over-year gain in revenue, with both numbers beating Street expectations. The company, though, said it expects its fourth-quarter earnings to be weaker as General Mills increases its marketing spend for new products. Shares were up by 2.7% at midday. 

 Adobe Systems (ADBE) shares were 3.7% higher at midday, after the firm reported adjusted earnings per share Tuesday ahead of Street forecasts, even though overall earnings sank by 65% from the same time last year. 

Also late Tuesday,  Williams-Sonoma (WSM) posted in-line revenue growth and operating margin gains for its fourth quarter, as the firm's lower-price-point value proposition and solid e-commerce platform continue to drive volume gains.  Morningstar analysts are particularly encouraged by management's upbeat 2013 forecast and three-year outlook. Shares had jumped by more than 11% by midday. 

Foreign Markets
Despite ongoing weakness in eurozone consumer confidence, European stocks finished mostly higher following the eased concerns about Cyprus. The FTSE 100 lost 0.2%, but the DAX and the Paris CAC gained 0.5% and 1.2%. 

In Asia, the Shanghai Composite increased by 2.7%, and the Nikkei 225 rose by 2.0%. The Hang Seng improved by 1.0%. 

Kevin O'Shaughnessy does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.