Good morning traders!
The S&P 500 ($SPY) is trading near yesterday’s close. Let’s get into it…
Stock futures had a slow start in premarket trading today due to upcoming corporate earnings and economic data releases later in the week. Geopolitical tensions, regional bank crisis, stubborn inflation, and the possibility of a recession continue to affect the markets. First Republic Bank continued its freefall, sliding 18% in premarket trading after almost half its value was wiped away. Oil prices also dropped this morning, following significant losses from the previous day, despite a report indicating that U.S. inventories had declined last week. Additionally, concerns over possible interest rate hikes by central banks to fight inflation could hinder economic growth and fuel demand. Despite a report showing a fall in U.S. oil stocks, analysts are concerned about the possibility of the economy falling into recession this year.
In the news, Microsoft and Alphabet had a good first quarter, beating expectations, which is good news for the sector. Job cuts aimed at improving profitability continue to be rewarded, and Alphabet’s $70 billion share buyback helped. Microsoft’s Windows commercial business performed well, suggesting companies and consumers are ready to upgrade their computers again, which would be good for chip makers. The buzz from artificial intelligence was a particular boost for Microsoft. Although the economic outlook is less than ideal due to higher interest rates, the tech sector is holding up, with the tech-heavy Nasdaq up 13% this year. If higher rates and recession are already priced in, tech could have a much better year.
Wednesday Economic Events:
MBA Mortgage Applications 7:00am ET
Durable Goods Orders 8:30am ET – High Volatility Expected
Int. Trade in Goods 8:30am ET
Wholesale Inventories 8:30am ET
EIA Petroleum Report 10:30am ET – High Volatility Expected
Fed Speaker Scheduled:
No Fed Speakers Schedule
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