Nasdaq futures slide but S&P 500, Dow futures hold up ahead of market open

US stocks may find it difficult to orient themselves on Wednesday after the market struggled en route to a mixed close in the previous session. Volatility could be on the agenda as another batch of Fed speeches are in the works.

On Tuesday, major averages opened significantly higher and moved sideways in early trading, encouraged by dovish comments from the Chicago Fed Chairman Charles Evans.

Along with the decline, the S&P 500 also breached the mid-June lows on an intraday basis and closed at its lowest level since Nov. 30, 2020.

Performance of US indices on Tuesday
Index Performance (+/-) Assess
Nasdaq Compound +0.21% 10,829.50
S&P 500 Index -1.03% 3,647.29
Dow Industrials -0.43% 29,134.99

Here is an overview of index futures trading:

Performance of US futures on Wednesday during the pre-market session
Index Performance (+/-)
Nasdaq 100 Futures Contracts -0.38%
S&P 500 Futures Contracts +0.02%
Dow Futures Contracts +0.08%
R2K Futures +0.01%

In pre-market exchanges on Wednesday, the SPDR S&P 500 ETF TrustTO SPY rose 0.13% to $359.05, while Invesco QQQ Trust QQQ was down 0.23% at $273.86, according to Benzinga Pro data.

“The Fed’s message to ‘keep going,’ straight out of the lexicon of inflation-killer Paul Volcker, suggests that market participants are going to be much more cautious before embracing a rebound and moving to the next level,” said Quincy Krosby, Chief Global Strategist at LPL Financial.

On the economics, traders can digest mortgage application volume data from the Mortgage Bankers Association for the week ended Sept. 23.

The focus is also likely to be on the National Association of Realtors’ pending home sales index for August, which is due out at 10 a.m. EDT. In July, the index, a leading indicator of housing activity, fell 1% month-on-month.

Atlanta Fed President Raphael Bostic is expected to participate in a moderated conversation on “Leadership in Banking” prior to “Banking and the Economy: A Forum for Minorities in Banking,” in Atlanta, Georgia. The event is scheduled for 9:25 a.m. EDT.

Chairman of the Federal Reserve Jerome Powell will give, via pre-recorded video, welcoming remarks prior to the 2022 Community Banking Research Conference hosted by the St. Louis Fed at 10:15 a.m. ET. Federal Reserve Board Governor Michelle Bowman is scheduled to speak on “The New Landscape of Banking Competition” at the same conference at 11 a.m. ET.

Richmond Fed President Thomas Barkins is scheduled to speak at the New Bern Chamber of Commerce at 11:30 a.m. ET.

At 2 p.m. ET, Evans is expected to take part in a moderated Q&A on current economic conditions or monetary policy hosted by the London School of Economics.

See: S&P 500 breaks past June low: Why pre-market readiness is watching this bond ETF

Targeted actions:

  • Apple Inc. AAPL is down about 4% after a Bloomberg report suggested the company was slowing the ramp-up of iPhone 14 production due to slower-than-expected demand.
  • Biogene, Inc. IBIB and Eisai Co.Ltd. ESALY could be in the spotlight after their second-generation Alzheimer’s treatment candidate passes a late-stage study. Biogen grew approximately 40% in pre-commercialization business. Eli Lilly & Company THERE ISwhich has a competing drug in development, also moves in sympathy.
  • Paychex, Inc. PAYX and Cintas Corp. ETG are among the companies that must publish their earnings before the market opens.

Commodities, global stock markets:

Crude oil, which rallied on Tuesday due to supply issues triggered by Hurricane Ian, is trading slightly lower. On Tuesday, Goldman Sachs lowered its oil price forecast for 2023, citing a weak demand outlook.

Major Asian markets fell on Wednesday, with Hong Kong’s Hang Seng falling more than 3%. The Taiwanese, South Korean and Chinese markets also recorded notable losses. Recession fears dominated, forcing investors to take cover under the safe-haven dollar. The Chinese yuan fell to its lowest level against the dollar since 2011, when data was first made available.

European stocks are trading moderately lower late in the morning, with the UK policy fiasco adding to the negativity.

About Teresa G. Wilson

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