US stocks lay cool ahead of Wednesday's open, with attention turned toward the US Federal Reserve’s stance on monetary policy, just a day after one of the largest equity rallies of the year; following a signal of stimulus from the European Central Bank, paired with breakthrough developments in US-China negotiation.
The US Federal Reserve will announce its decision on monetary policy at 2:00pm EST today, with the tone of its statement and subsequent remarks from its chairman, Jay Powell, at 2:30pm EST, expected to dominate sentiment, amid recent pressure from Donald Trump to "level the playing field" in global commerce with lower interest rates.
This morning’s price-action comes after Tuesday’s session, where a dose of fresh stimulus from the European Central Bank and renewed hopes of an end to the US-China trade war left the S&P 500 within 1% of its all-time closing high.
Confirmation from Trump that he would hold a meeting with his Chinese counterpart Xi Jinping at the G20 summit in Osaka this month fueled an early morning rally of hope - on beliefs that a high-level meeting between both countries' leaders could produce a breakthrough in the long-running dispute.
Wall Street’s S&P 500 index settled 0.95% below its April 30 all-time peak, with a +1.05% daily advance, retracing from its intraday peak where the index had been as little as 0.4% shy of an all-time high.
Meanwhile, the Dow Jones Industrial Average is positioned 0.7% short of its all-time peak, whereas the tech-heavy Nasdaq Composite has a bit more work to do, down by 2.6% from all-time highs.
In today’s economic calendar, aside from Fed announcements, Wednesday also includes; Oil Inventories for the week ended June 14, at 10:30am EST.
In corporate news; Oracle (ORCL), American Outdoor Brands (AOBC), Winnebago Industries (WGO) and Barnes & Noble (BKS) are all expected to report their earnings today.
TODAY'S TOP HEADLINES
Economy & Politics: Fed, Facing Pressure on Rate Cut, to Decide on Next Move. (The WSJ)
Federal Reserve officials will wrap up their two-day meeting Wednesday after discussing whether they will need to lower the benchmark interest rate, if not now, then in summer.
ECONOMIC CALENDAR
Today's Economical Announcements.
10:30AM - ★★★ - Crude Oil Inventories (Previous: 2.206M)
02:00PM - ★★★ - FOMC Statement
02:30PM - ★★★ - FOMC Press Conference
STOCKS IN THE SPOTLIGHT
Pre-Market Movers & News Related Stocks.
Adobe (ADBE): [EARNINGS] Reported adjusted quarterly profit of $1.83 per share, 5 cents a share above estimates. Revenue also topped forecasts. The company’s results were helped by growth in its Creative Suite business, as well as its digital media offerings. Adobe gave lower-than-expected current-quarter guidance.
U.S. Steel (X): [GUIDANCE] Said its second-quarter earnings would be lower than Wall Street had been expecting, due to softer demand and lower prices.
Winnebago (WGO): [EARNINGS] Reported earnings of $1.14 per share, compared to a consensus estimate of 99 cents a share. The bottom line was helped by 10 cents per share in one-time positive items, including a more favorable tax rate and a change in estimates related to research and development credits. Revenue missed estimates.
Jabil (JBL): [EARNINGS] Matched forecasts with adjusted quarterly profit of 57 cents per share, while the contract electronics manufacturer’s revenue beat Street forecasts. Apple is Jabil’s biggest customer.
Mattel (MAT): [NEWS] MGA Entertainment has abandoned its second attempt to buy its rival toymaker, according to a statement made by MGA CEO Isaac Larian to the Los Angeles Times.
American Express (AXP): [RATING] Bank of America reinstated coverage of the financial services company with a “buy” rating, noting the company’s strong brand and several positive factors including card fee increases and portfolio growth.
Apple (AAPL): [NEWS] Is considering moving up to 30% of its China-based manufacturing out of the country, according to a report in Japan’s Nikkei news service.
Southwest Airlines (LUV): [GUIDANCE] Raised its full-year revenue for revenue per available seat mile, owing to what it calls “solid” demand. Southwest also extended cancellations of flights involving the 737 Max through September 2.
CBS (CBS): [NEWS] CBS is preparing a bid for Viacom (VIAB), according to The Wall Street Journal.
La-Z-Boy (LZB): [EARNINGS] Earned an adjusted 64 cents per share for its latest quarter, matching Street forecasts, while the furniture maker’s revenue was short of estimates. The revenue short fall was largely due to soft demand in its wholesale segments. It also said additional US tariffs on China imports would likely force it to raise prices because of higher raw material costs.
Alphabet (GOOGL): [NEWS] Alphabet was urged by shareholder activists to break itself up before regulators force the Google parent to do so.
PG&E (PCG): [NEWS] Settled claims with local governments over wildfires for $1 billion. The payments settle claims that had been on hold due to the utility company’s bankruptcy filing.
Tesla (TSLA): [NEWS] Lost another executive, with human resources vice president and head of diversity Felicia Mayo leaving the automaker.
NCR (NCR): [NEWS] Private-equity firms who had been interested in buying the ATM and barcode scanner maker have walked away without striking a deal, according to the New York Post.
MOMENTUM STOCKS
GAINERS: SPWR, TDS, SNAP, STLD, OLED
DECLINERS: GCP, STZ, ECL, TSN
TODAY'S IPOs
Stoke Therapeutics (STOK) (Price: 18) (Est. Vol: $142.0M)
