Stock Futures Waver Ahead of Fed Minutes

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The yield on the 10-year US Treasury extended a series of recent declines

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Stocks have had a volatile start to the week due to a tightening of monetary policy by the Federal Reserve to counter the battle of high inflation and concerns about how sharp it may be due to a slowdown in growth. The S&P 500 is down nearly 18% from its previous record high in January and plunged into a bear market before closing losses last Friday.

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“It has been really volatile, to say the least. It begs the question of whether a recession is coming or not. It should effectively push the market,” said Fahd Kamal, chief investment officer at Kleinwort Hambros. is dragging and pulling.”

Minutes of the Federal Reserve meeting earlier this month will be out at 2 p.m. ET and are expected to provide investors with more clues about policymakers’ outlook on the economy and inflation. US durable goods orders for April will be available at 8:30 a.m. ET.

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The yield on the benchmark 10-year Treasury note declined to 2.751% from 2.758% on Tuesday. It has declined in four of the last five trading sessions. Yields fall when prices rise.

“The market is pricing the recession that will eventually come with the Fed’s stricture. It also predicts that inflation will slow to a much more reasonable level in 2023,” said Antonio Cavaro, head of investment at Generali Insurance Asset Management.

Government debt performs well in times of slow economic growth, which has led to stability in the bond market in recent times.

Oil prices were trading up 1.3% at $112.13 a barrel with global benchmark Brent crude. The US Energy Secretary said the Biden administration did not rule out restrictions on oil exports to drive down domestic fuel prices, Reuters reported.

In premarket trading, Snap shares fell another 0.5% on Tuesday after falling 43% after the company issued a profit warning citing macroeconomic conditions, which have turned sharper and worse than expected. .

“Clearly there has been a re-evaluation of the technical assessment. It’s impossible to know how far this goes, but some of these are quality businesses and are significantly cheaper than what they’ve been trading recently,” Mr. Kamal said. “If you’re a long-term investor, it’s worth it.” Something interesting is about to happen.”

It jumped more than 10% after retailer Nordstrom raised its guidance for full-year revenue growth. Home builder Toll Brothers rose nearly 7% after reporting revenue and profit that beat analysts’ expectations.

Tech giant Nvidia and retailers Williams-Sonoma and Express are due to report earnings on Wednesday.

Overseas, the pan-continental stokes Europe 600 declined 1%. British online grocer Okado fell 5% after it cut sales guidance for a joint venture due to changes in consumer behavior due to rising prices.

In Asia, key benchmarks were mixed. The Shanghai Composite Index rose 1.2% while Hong Kong’s Hang Seng was up 0.3%. Japan’s Nikkei 225 fell 0.3%.

Write to Anna Hirtenstein at [email protected]

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