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U.S. stock futures extended their declines on Wednesday, following the S&P 500's first monthly decline since last fall, as investors braced for a hawkish statement from the Federal Reserve amid another revision to interest rate forecasts for the largest economy in the world.
stocks fell across the board on April 30, dragging the S&P 500 80.5 points, or 1.57%, lower on the session, its biggest single-day drop since late January, as investors analyzed data showing a big jump in first-quarter employment costs and navigating declines. in each of the so-called Magnificent 7 mega-cap tech stocks.
Meanwhile, Treasury yields rose, lifting benchmark 2-year bonds firmly above 5% following the Employment Costs Index data, which further reduced bets that the Federal Reserve would cut rates. from now to the end of the year.
Investors will be closely focused on Fed Chair Jerome Powell's messaging when he speaks to the media today in Washington, where he is likely to reiterate the central bank's stance on “higher for longer” interest rates.
Related: The Federal Reserve faces a fine line between inflation hawks and slow growth realists
No change in the Fed's benchmark interest rate, which currently stands between 5.25% and 5.5%, is expected from the Fed's two-day policy meeting, and the Markets are now pricing in only one rate cut between now and the end of the year.
Wall Street also faces another busy session of earnings and data releases, with updates from Pfizer. (PFE) Mastercard (MOTHER) CVS Health (CVS) and Estée Lauder (HE) scheduled before the opening bell.
CVS Health fell 12.2% after cutting its full-year revenue forecast due to weaker-than-expected profits tied to rising costs in its health insurance division.
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The Department of Labor's March job openings and labor turnover report, better known as Jolts, is also scheduled for later in the morning, right after ADP's National Employment report at 8:15 a.m. ET .
Futures contracts tied to the S&P 500, which ended April down 4.16%, are priced for an opening drop of 17 points, while those tied to the Dow Jones Industrial Average suggest a pullback of 75 points.
The tech-focused Nasdaq, which fell 2.2% on Tuesday to extend its April decline to 4.41%, is considered 90 points lower.
starbucks (SEX) The stock is a notable advance, falling more than 13% after the world's largest coffee chain lowered its full-year sales forecast following weaker first-quarter sales in both the United States and China.
Advanced Micro Devices (amd) It was also in the red, falling 6% after beating Wall Street's first-quarter earnings estimates, but estimating full-year chip sales of around $4 billion, up a modest $500 million. with respect to its previous forecast.
On the bright side, amazon (AMZN) Shares rose 2% after the online retail and technology giant posted better-than-expected first-quarter earnings, including more than $25 billion in revenue from amazon Web Services. However, the gains were tempered by a weak near-term sales forecast and a warning that capital spending would increase throughout the year.
More Wall Street analysts:
- Analyst reveals new Nike price target ahead of big summer for sports
- Analysts weigh in on Google parent Alphabet shares after cloud event
- Analysts Renew Disney Stock Price Target After Proxy Fight
In foreign markets, the European Stoxx 600 fell 0.77% at midday on the Frankfurt Stock Exchange. Britain's FTSE 100 rose 0.08% thanks in part to a weaker pound, which fell to 1.2482 against the US dollar.
Overnight in Asia, Japan's Nikkei 225 closed down 0.34% in Tokyo, while the MSCI regional index excluding Japan gained 0.29% in late trading hours.
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