Equities improved Wednesday as earnings came in good enough to keep sentiment buoyant. The Dow Jones industrial average rose 0.8 percent to a record close, the S&P 500 gained 0.5 percent and the Nasdaq was up 0.3 percent. Bond yields and oil prices declined while the dollar rose.

Hopes for a soft landing or no landing at all continue to provide a favorable macro backdrop. Buying appeared broadly dispersed Wednesday after a rotation out of megacaps and chipmakers on Tuesday. Earnings and revenues beats at United Airlines lifted airlines; Morgan Stanley's boosted investment banks; and Synchrony Financial helped credit cards outperform. Homebuilders, managed care and utilities also beat the market.

Bond yields declined Wednesday after weekly mortgage applications showed a notable drop in the latest week as the housing market reacts to a jump in mortgage rates. Investors are awaiting a busy morning of economic reports Thursday including retail sales, jobless claims, Philly Fed, industrial production and the homebuilders index.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.