US STOCKS-Wall St set to open lower with earnings underway, eyes on Fed
Microsoft Corp gained 1.7% premarket, as the software maker continues to benefit from remote working and learning trends globally
U.S. stock indexes were set to open lower on Wednesday as investors parsed through earnings reports from companies including Boeing and Microsoft, ahead of the Federal Reserve’s policy statement later in the day.
Microsoft Corp gained 1.7% premarket, as the software maker continues to benefit from remote working and learning trends globally.
Microsoft’s results set a positive precedent for other technology-related companies including Apple Inc, Tesla Inc and Facebook Inc, which are set to report quarterly numbers later in the day.
Tech companies have recently come back into favor after blowout results from streaming service provider Netflix Inc , and as investors dumped economy-linked banks, energy and small-cap stocks.
However, concerns about heightened stock market valuations, raging coronavirus cases and any potential disruption to vaccine rollouts have spooked investors about a pullback and increase in volatility in the near-term.
“The market is kind of in a wait-and-see mode. Investors just want to gather more information from the earnings season, they want more confidence from the Fed, and we should get a big insight into that today,” said Craig Erlam, senior market analyst at OANDA.
The Fed is expected to keep monetary policy locked in crisis-fighting mode at its meeting ending on Wednesday, with investors also looking forward to relief from ongoing vaccinations and new government spending plans.
There is a high risk of a resurgence in COVID-19 infections derailing the world economy this year, according to a majority of economists in a Reuters poll, who forecast global GDP would reach pre-pandemic levels within two years.
“We are going through what is likely to be the absolute worst moment of this entire pandemic right now,” Erlam said.
Meanwhile, Boeing Co fell 3.3% after posting a record $12 billion annual loss, as it delayed its all-new 777X jet again and booked a $6.5 billion charge for the program.
At 8:33 a.m. ET, Dow e-minis were down 319 points, or 1.03%, S&P 500 e-minis were down 43 points, or 1.12%, and Nasdaq 100 e-minis were down 113.25 points, or 0.84%.
Starbucks Corp fell 2.7% after the coffee chain reported a larger-than-expected fall in quarterly sales, as the renewed surge in coronavirus cases in the United States kept customers at home.
Walgreens Boots Alliance Inc jumped 4.3% after the drugstore chain named the outgoing chief operating officer of Starbucks, Roz Brewer, as its chief executive officer.
Videogame retailer GameStop Corp’s shares surged another 41.9% on Wednesday, as amateur investors continued to pile into the stock that has skyrocketed nearly 700% over the past two weeks. (Reporting by Devik Jain and Shreyashi Sanyal in Bengaluru; Editing by Shounak Dasgupta)
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