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Midday Market Update

Stocks Higher With Eyes on Fed

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U.S. Market    
Stocks were up at midday following statements from Fed chairman Ben Bernanke and ahead of the minutes release from the Federal Open Market Committee's May 1 meeting. 

Speaking to Congress this morning, Bernanke lauded the benefits of the Fed's current bond-buying program but also said that governmental budget cuts are creating a drag on the economy. More notably, as Wall Street was looking for more guidance as to when the Fed might pare back the current monthly asset purchases, Bernanke did not hint of any forthcoming decision. 

Separately, the National Association of Realtors said existing-home sales improved by 0.6% in April from March's reading, and they were 9.7% higher compared with the same time last year. However, the April tally was still lower than the expected 1.4% gain, indicating that current sales trends might be losing steam. 

At midday, the Dow and the S&P 500 had each gained 0.7%, while the Nasdaq was up by 0.5%. 

Stocks on the Move
 Lowe's (LOW) reported a 2.5% increase in first quarter net income, while sales slipped slightly. Both readings fell short of Street expectations, as cooler weather during the spring months has hindered normal sales growth. The firm maintained its full-year outlook, however, and shares were 1.4% higher at midday. 

 Staples (SPLS) posted a 9.2% drop in earnings for the first quarter, and total revenue also fell by 3.5% compared with the same time last year, also missing Street forecasts. The firm continues to face challenges in its North American and European segments, but Staples also maintained its full-year outlook. Shares were up by 3.3% at midday. 

 Target (TGT) shares had sunk by 3.5% at midday after the retailer reported its first-quarter earnings fell by 29% compared with the same time last year. Revenue also slipped by 1%, and, like Lowe's, cooler weather inhibited Target's quarterly sales, as did economic concerns. Target also lowered its full-year earnings forecast

 Pfizer (PFE) shares had gained more than 3% after the Big Pharma firm announced it is spinning off the remainder of its interest in  Zoetis (ZTS) in a share-exchange offer with existing stockholders. Zoetis shares were down by 0.7% at midday. 

Foreign Markets
Stocks in Asia were mixed Wednesday. The Shanghai Composite and the Hang Seng lost 0.1% and 0.5%, while the Nikkei 225 gained 1.6%. 

European stocks were higher, as the FTSE 100 gained 0.5%, the Paris CAC rose by 0.4%, and the DAX increased by 0.7%. 

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