US open: Stocks edge higher ahead of Apple earnings

US stocks edged higher on Monday, as investors awaited Apple’s quarterly results.

Just after 15:00 in London, the Dow Jones Industrial Average was up 63 points, while the S&P 500 and the Nasdaq gained six and 19 points respectively.

On Friday, the S&P 500 and the Nasdaq Composite notched all-time highs on the back of better than-expected earnings and the focus will be on corporates again on Monday, with Apple set to publish its results after the closing bell.

The California-based giant is expected to report another quarter of strong profit and sales growth, with its results likely to set the tone for the rest of the week.

“As encouraged as Apple investors will be that a new product has been added to the range, the lingering feeling of underachievement continues with the excessive stockpiling of cash,” said Alastair McCaig, market analyst at IG.

UBS expects the Apple Watch to be about a third as popular as the iPad and half as popular as the iPhone at launch. Nevertheless it forecasts sales of 36m units in the first year and 40m in 2016, with the success of the iPhone 6 key to an expected near-24% rise in quarterly revenues to $56.5bn, a possible dividend hike and maybe even a share repurchase scheme.

The economic calendar will begin the week on a relatively quiet note, before heating up on Wednesday, with the release of a preliminary reading on first-quarter gross domestic product and the conclusion of the Federal Open Market Committee’s two-day meeting.

“The relatively hawkish comments by FOMC members following the decision to remove the word ‘patience’ from the statement have not stacked up against a spate of poor economic data, notably a slowdown in hiring,” said CMC Markets analyst Jasper Lawler.

“This discrepancy is creating hope that the Fed will opt to tighten policy later, explaining the stock market push to near record highs.”

Business activity in the US service sector remained steady throughout April, data released on Monday showed.

The seasonally adjusted Markit Flash US Services PMI business activity index declined from 59.2 to 57.8 in April, but remained well above the 50.0 threshold.

Meanwhile, the seasonally adjusted Markit Flash US composite PMI output index declined 59.2 to 57.4 in April, but remained well above the post-crisis average of 55.9.

The latest figures pointed towards the sharpest increase in US private sector payroll number since June 2014, driven by a solid job creation this month

Away from the earnings season, IT group iGate rose 3.51% after French computer services and tech group Capgemini said it would acquire the group for $4bn.

Marvell Technology Group declined 0.52%, after announcing on Friday that revenue will be lower than expected/

Deutsche Bank saw its New York-listed shares fall 4.46% after it revealed plans to scale down on investment banking.

Oil prices were mixed, with West Texas Intermediate gaining 0.85% to $57.64 a barrel, while Brent shed less than 0.1% to $65.23 a barrel.

The dollar was stable against both the pound the euro and rose 0.33% against the yen, while gold futures climbed 0.88% to 1,185.30.