After moving sharply lower over the two previous sessions, stocks may see further downside in early trading on Wednesday. The major index futures are currently pointing to a lower open for the markets, with the S&P 500 futures down by 0.4 percent.
Lingering concerns about the outlook for interest rates and the likelihood of a recession are likely to continue to weigh on Wall Street.
The Fed still seems poised to slow the pace of interest rate hikes next week, but recent upbeat economic data has raised concerns about how much further the central bank will raise rates at future meetings.
Traders are likely to pay close attention to the Fed’s accompanying statement, although a lot of key data will be released before the next meeting in late January/early February.
The recent selling on Wall Street partly reflects worries the Fed will be need to push the economy into a prolonged recession in order to bring inflation down close to its 2 percent target.
On the U.S. economic front, revised data released by the Labor Department showed labor productivity increased by much more than initially estimated in the third quarter.
The Labor Department said labor productivity climbed by 0.8 percent in the third quarter compared to the previously reported 0.3 percent uptick. Economists had expected productivity growth to be upwardly revised to 0.5 percent.
Meanwhile, the report showed the surge in unit labor costs in the third quarter was downwardly revised to 2.4 percent from 3.5 percent. The jump in unit labor costs was expected to be downwardly revised to 3.2 percent.
Stocks moved sharply lower during trading on Tuesday, extending the sell-off seen over the course of Monday’s session. The major averages all showed significant moves to the downside, with the tech-heavy Nasdaq posting a particularly steep loss.
The major averages climbed off their worst levels going into the close but remained firmly negative. The Dow slumped 350.76 points or 1.0 percent to 33,596.34, the Nasdaq plunged 225.05 points or 2.0 percent to 11,014.89 and the S&P 500 tumbled 57.58 points or 1.4 percent to 3,941.26.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan’s Nikkei 225 Index slid by 0.7 percent, while Hong Kong’s Hang Seng Index plummeted by 3.2 percent.
European stocks have also moved mostly lower on the day. While the German DAX Index and the French CAC 40 Index are both down by 0.3 percent, the U.K.’s FTSE 100 Index has bucked the downtrend and inched up by 0.1 percent.
In commodities trading, crude oil futures are climbing $0.88 to $75.13 a barrel after plunging $2.68 to $74.25 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,790.60, up $8.20 compared to the previous session’s close of $1,782.40. On Tuesday, gold inched up $1.10.
On the currency front, the U.S. dollar is trading at 136.78 yen compared to the 137.00 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.0527 compared to yesterday’s $1.0467.
Business News
U.S. Stocks May See Further Downside In Early Trading
2022-12-07 13:53:25
