Stock futures open slightly lower ahead of Federal Reserve update
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Traders work on the floor at the closing bell of the Dow Industrial Average at the New York Stock Exchange on January 10, 2019 in New York.
AFP | AFP | Getty Images
U.S. stock futures opened slightly lower Tuesday night after the major averages tried but failed to rebound from Monday’s Evergrande-led sell-off in the regular session.
Dow Jones Industrial Average futures dropped 30 points or 0.09%. S&P 500 futures and Nasdaq 100 futures fell 0.13% and 0.18%, respectively.
Regular trading saw the Dow lose 50.63 point, or 0.15%. The S&P 500 shed about 0.1% following its worst day since May on Monday. The Nasdaq Composite gained 0.2%.
As the global market digested the news about Evergrande, a Chinese property developer facing bankruptcy, the markets kept on going. The Dow Jones Industrial Average regained more than half Monday’s losses at its peak, but these gains were quickly lost in volatile trading.
The Dow and S&P looked poised to snap a three-day losing streak in the late afternoon but turned lower into the close, finishing in the red for the fourth day in a row and the fifth of the past six sessions. The Dow is down 4% in September while the S&P is down 3.7%.
Fundstrat’s Tom Lee, Fundstrat’s CEO said Tuesday that the market’s current flatness is “a very good result.” We are still in a situation where stocks will rally strongly from this because, unless Evergrande has a serious seismic effect on America’s economy, U.S. fundamentals remain in great shape.
The Federal Reserve will conclude its two-day meeting on Wednesday and release a policy statement with economic and interest rate forecasts. At 2:30 pm, Chairman Jerome Powell will speak to media. ET
Investors are eager to learn more about the timing of when the central banks plans to reduce its bond purchases. Powell previously stated that it might begin in the first half of this year. However, it may not happen.
I think that they will make it clear that they have had a conversation about tapering. I don’t think they’re going to provide any details,” BlackRock chief investment officer of global fixed income Rick Rieder told CNBC. They’ll provide the framework so they can begin in November and December.
General Mills, Blackberry and other companies will announce quarterly earnings Wednesday.
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