Wednesday July 29th

29-07-2020

Stock futures are flat ahead of Fed decision and Big Tech testimony

U.S. stock index futures were little changed early Wednesday as investors awaited a congressional hearing on antitrust in Big Tech as well as the Federal Reserve’s latest policy decision. Dow Jones Industrial Average futures rose just 5 points, or less than 0.05%. S&P 500 futures gained 0.1% and Nasdaq 100 futures advanced 0.4%. The Fed will conclude its two-day policy meeting Wednesday and is set to release a statement at 2 p.m. ET. Chairman Jerome Powell will have a press conference at 2:30 p.m. ET. The central bank is expected to keep short-term interest rates unchanged at near zero to support the economy still struggling with the coronavirus pandemic. On Tuesday, the Fed announced it would extend its emergency lending programs through the remainder of 2020. “Markets continue to expect ultra-accommodative policy from the Fed, and the Fed is unlikely to disappoint at this meeting,” Bill Callahan, investment strategist at Schroders, said in an email. “Given that we are still squarely in the center of the pandemic, the only question for investors is just how dovish the Fed will be.” Meanwhile, the chief executives of Amazon, Apple, Facebook and Google-parent Alphabet will testify before the House Antitrust Subcommittee later Wednesday following a yearlong probe into their anti-competitive practices. Investors will look for insights on how the Big Tech is handling antitrust challenges from regulators with the authority to break them up. Shares of Big Tech are among the best performers this year. Facebook and Alphabet are both up more than 12% year to date entering Wednesday’s session. Amazon has skyrocketed 62.4% over that time and Apple is up 27%. The busiest week of the earnings season continued, with General Electric and Boeing releasing their latest quarterly figures. GE reported a stronger-than-forecast revenue, sending the stock up 1.6% in the premarket. Boeing posted a wider-than-expected loss and the stock traded 0.5% lower. Shares of Advanced Micro Devices popped more than 1% after the chipmaker posted on Tuesday better-than-expected quarterly earnings and issued an upbeat guidance for the year. Starbucks swung to a loss during its fiscal third quarter, but the world’s largest coffee chain raised its forecast for the current quarter, sending shares up more than 5% in extended trading. Stocks in Asia Pacific were mixed on Wednesday as investors awaited the U.S. Federal Reserve’s interest rate decision. Mainland Chinese stocks led gains regionally, with the Shanghai composite surging 2.06% to about 3,294.55 while the Shenzhen component soared 3.119% to around 13,557.44. Hong Kong’s Hang Seng index edged 0.34% higher, as of its final hour of trading. In South Korea, the Kospi closed 0.27% higher at 2,263.16. Japanese stocks lagged their peers in the region’s major markets, with the Nikkei 225 down 1.15% to close at 22,397.11 while the Topix index fell 1.28% to end its trading day at 1,549.04. Oil prices rose on Wednesday after an industry report showed that crude inventories in the United States fell against expectations, giving the market a boost amid record increases of coronavirus infections in the U.S. and elsewhere. Brent crude futures were up by 49 cents, or 1.13%, at $43.71 a barrel, after dropping 0.4% on Tuesday. West Texas Intermediate crude futures gained 36 cents, or 0.85%, to $41.39 a barrel, having dropped 1.4% in the previous session. Gold prices steadied on Wednesday as worries over rising cases of COVID-19 and expectations of possible inflation from more stimulus measures underpinned the metal, while investors awaited the U.S. Federal Reserve’s meeting outcome later in the day. Spot gold was little changed at $1,956.81 per ounce. Prices hit an all-time of $1,980.57 on Tuesday before retreating after investors booked profits and the dollar regained some ground. U.S. gold futures rose 0.5% to $1,954.