Major US stock indices recorded solid gains, as strong quarterly reporting by retailers such as Lowe's (LOW) and Target (TGT) contributed to the growth of optimism among investors. In addition, the focus was on the minutes of the July meeting of the Fed.

Target shares (TGT) soared 19.86% to record levels after the company announced it received adjusted quarterly earnings of $ 1.82 per share, which was $ 0.20 higher than analysts' average forecast. The retailer’s revenue also exceeded Wall Street forecasts. Comparable sales of the company grew by 3.4%, while the forecast of analysts surveyed by Refinitiv suggested an increase of 2.9%. Target also raised its full-year earnings forecast.

Shares of Lowe's (LOW) jumped 10.41%, as the company showed adjusted quarterly earnings of $ 2.15 per share against the average forecast of analysts at $ 2.00. Its revenue also exceeded market expectations. Lowe's comparable sales rose 2.3%, which was higher than the consensus estimate of + 1.9%.

Exceeding the quarterly results of these two retailers indicated strong consumer demand, which helped ease some concerns about a slowdown in US economic growth.

Meanwhile, US President Trump today again wrote several critical messages about the Fed and its chairman on Twitter. Including he said that the only problem for the US is “Jay Powell and the Fed.” “If he decides to significantly reduce the rate, the US economy will grow strongly, but you can’t count on him. Until now, he has only let us down, ”Trump added.

Regarding the minutes of the Fed meeting, the document said that most Fed leaders considered the rate cuts in July to be a recalibration of policies and not the beginning of a more aggressive cycle of easing them, and at the last FOMC meeting, they were reluctant to predict the future path of rates. The protocol indicated that Fed leaders expect the uncertainty surrounding the Trump administration’s trade policy to continue, which will have a “lasting negative impact” on the prospects for the US economy. The opinions of FOMC members on the need to lower rates in July were divided. Several executives thought that rates should be left unchanged, because "the real economy remains in good shape," the protocol says. Two leaders, on the contrary, called for lowering rates in July by 0.5%, which, in their opinion, would be more effective in solving the problem of "persistently low" inflation.

Almost all DOW components completed trading in positive territory (29 out of 30). The biggest gainers were NIKE, Inc. (NKE, + 2.78%). Only Walmart Inc. shares fell in price (WMT, -0.08%).

All S&P sectors recorded an increase. The conglomerate sector grew the most (+ 2.0%).

At the time of closing:

Dow 26,202.73 +240.29 +0.93%

S&P 500 2,924.43 +23.92 +0.82%

Nasdaq 100 8,020.21 +71.65 +0.90%

The U.S. Energy Information Administration (EIA) revealed on Wednesday that crude inventories fell by 2.732 million barrels in the week ended August 16. Economists had forecast a drop of 1.500 million barrels.

At the same time, gasoline stocks rose by 0.312 million barrels, while analysts had expected a decline of 0.200 million barrels. Distillate stocks surged by 2.610 million barrels, while analysts had forecast a decrease of 0.300 million barrels.

Meanwhile, oil production in the U.S. was unchanged at 12.300 million barrels a day.

U.S. crude oil imports averaged 7.2 million barrels per day last week, down by 497,000 barrels per day from the previous week.

U.S. stock-index futures surged on Wednesday as solid earnings reports from retailers Lowe’s (LOW) and Target (TGT) pointed to robust consumer demand, helping ease some concerns over slowing economic growth..

Global Stocks:

(company / ticker / price / change ($/%) / volume)

Chevron (CVX) initiated with Outperform at BMO Capital Markets

Exxon Mobil (XOM) initiated with Market Perform at BMO Capital Markets; target $86

Target (TGT) reported Q2 FY 2019 earnings of $1.82 per share (versus $1.47 in Q2 FY 2018), beating analysts’ consensus estimate of $1.62.

The company’s quarterly revenues amounted to $18.422 bln (+3.6% y/y), generally in line with analysts’ consensus estimate of $18.320 bln.

The company issued in-line guidance for Q3, projecting EPS of $1.04-1.24 versus analysts’ consensus estimate of $1.17.

It also raised guidance for FY 2019, projecting EPS of $5.90-6.20 versus its prior guidance of $5.75-6.05 and analysts’ consensus estimate of $5.94.

TGT rose to $100.40 (+17.39%) in pre-market trading.

Lowe's (LOW) reported Q2 FY 2019 earnings of $2.15 per share (versus $2.07 in Q2 FY 2018), beating analysts’ consensus estimate of $2.00.

The company’s quarterly revenues amounted to $20.992 bln (+0.5% y/y), generally in line with analysts’ consensus estimate of $20.958 bln.

The company also reaffirmed guidance for FY 2019, projecting EPS of $5.45-5.65 (versus analysts’ consensus estimate of $5.57) and revenues of ~$72.74 bln or+2% y/y (versus analysts’ consensus estimate of $72.53 bln).

LOW rose to $110.00 (+12.39%) in pre-market trading.