Stocks may move to the downside in early trading on Wednesday, extending the downward trend seen over the past several sessions. The major index futures are currently pointing to a modestly lower open for the markets, with the S&P 500 futures down by 0.2 percent.
Lingering concerns about the outlook for interest rates may continue to weigh on the markets ahead of the release of the Federal Reserve’s Beige Book this afternoon.
The Beige Book is a compilation of anecdotal evidence on economic conditions in each of the twelve Fed districts.
The report, which comes two weeks ahead of the Fed’s next monetary policy decision, may shed additional light on the outlook for rates.
CME Group’s FedWatch tool is currently indicating an 82.0 percent chance of a 75 basis point rate hike and an 18.0 percent chance of a 25 basis point rate hike.
Recent data suggesting the economy is holding up relatively well amidst the Fed’s previous rate increases has led to speculation the central bank will remain aggressive.
A report released by the Commerce Department this morning showed the U.S. trade deficit narrowed significantly in the month of July.
The Commerce Department said the trade deficit shrank to $70.6 billion in July from a revised $80.9 billion in June.
Economists had expected the trade deficit to narrow to $70.3 billion from the $79.6 billion originally reported for the previous month.
After an initial move to the upside, stocks showed a lack of direction over the course of the trading session on Tuesday. The major averages bounced back and forth across the unchanged line before ending the day firmly negative.
The major averages finished the session at their worst closing levels in well over a month. The Dow fell 173.14 points or 0.6 percent to 31,145.30, the Nasdaq slid 85.96 points or 0.7 percent to 1,544.91 and the S&P 500 dipped 16.07 points or 0.4 percent to 3,908.19.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan’s Nikkei 225 Index declined by 0.7 percent, while Hong Kong’s Hang Seng Index slumped by 0.8 percent.
The major European markets have also moved to the downside on the day. While the U.K.’s FTSE 100 Index is down by 0.9 percent, the German DAX Index is down by 0.8 percent and the French CAC 40 Index is down by 0.7 percent.
In commodities trading, crude oil futures are falling $0.51 to $86.37 a barrel after inching up $0.01 to $86.88 barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,712.40, down $0.50 compared to the previous session’s close of $1,712.90. On Tuesday, gold fell $9.70.
On the currency front, the U.S. dollar is trading at 144.90 yen compared to the 142.80 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $0.9881 compared to yesterday’s $0.9904.
Business News
U.S. Stocks May See Further Downside In Early Trading
2022-09-07 12:52:44
