US Stocks Drop as Earnings Kick Off, Fed Minutes Ahead

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Key Takeaways

• Stocks on Wall Street declined on Tuesday and futures indicate a muted open on Wednesday
• Investors await a slew of events today: earnings season kickoff, inflation data, and Fed minutes

What’s on Focus in the Markets?

Wall Street stocks closed lower for the third consecutive day on Tuesday. Losses in communication stocks led to the decline, along with big-tech companies. The Dow Jones Industrial Average slipped 117.72 points, or 0.34%, to finish the day at 34,378.24. In addition, the S&P500 and the Nasdaq Composite lost 0.24%, and 0.14%, respectively.

US stock futures, on the other hand, floated mixed ahead of the opening bell in New York on Wednesday. Futures contracts on all three major indexes indicated a flat opening, as they swung between gains and losses.

The US dollar, in the meantime, keeps relatively unchanged as important economic reports are expected to weigh on currencies today. That said, the EUR/USD rate was slightly up early on Wednesday and hovered near 1.1550. Moreover, the USD/CAD dropped to a low of 1.2430, a price level last seen near the end of July.

What’s the Latest News on Bitcoin?

The price of bitcoin, the largest cryptocurrency, is witnessing some struggles to the upside on Wednesday. In more detail, the orange coin pushed to a session high of $56,600 but later momentum faded. Presently, bitcoin is changing hands slightly above $55,000 per coin.

Still, the token has made spectacular gains over the past couple of weeks. Since the beginning of October, the price of bitcoin has rallied about 30%, retaking $1tn in market valuation. Prospects for cryptocurrencies have largely improved as participants expect a warm regulatory climate in the US.

What’s New Around the Markets?

On Wednesday, a number of heavyweight reports are poised to increase volatility and add some intensity to stocks and currencies. With that in mind, investors expect the beginning of the earnings season.

Third-quarter reporting from major corporations kicks off today with financial results from investment banking giant JPMorgan Chase. Also, the world’s largest asset manager, BlackRock, is expected to show its assets under management surpassed $10tn.

Inflation data in the US slated for today is likely to indicate consumer prices remained elevated in September. Last month revealed companies struggled with higher production costs due to rising energy prices. On that note, the consumer-price report is expected to reflect climbing inflation pressures.

And finally, the US Federal Reserve, the central bank of America, releases minutes from its last meeting in late September. The summary of the gathering will be closely monitored by investors. They will expect to learn more about the central bank’s plans for tapering or reducing, the pandemic-related stimulus.

Today’s Economic Calendar (EST times)

• 08:30 am, US, Core CPI (MoM)(Sep)
• 02:00 am, US, FOMC Meeting Minutes
• 08:30 pm, AUD, Employment Change (Sep)