Before the Bell | Futures edge higher as focus turns to Fed meeting

Moomoo Breakfast US wrote a column · May 2, 2022 06:35

Hey, mooers! Here are things you need to know before the opening bell:

Market Snapshot

Stocks were mixed Monday and the dollar gained as worries over high inflation, tightening monetary policy contributed to investor caution.

U.S. futures rose modestly after slumping in April, the worst month since the pandemic roiled markets more than two years ago. Europe's Stoxx 600 index followed Asian shares lower in sessions affected by holiday closures. Oil fell.

Futures tied to the tech focused $NASDAQ 100 Index(.NDX.US)$ traded mostly flat. $Dow Jones Industrial Average(.DJI.US)$ futures rose 0.19% and $S&P 500 Index(.SPX.US)$ futures added 0.05%.

Before the Bell | Futures edge higher as focus turns to Fed meeting

Top News

Fed Prepares Double-barreled Tightening With Bond Runoff

To support financial markets and the economy during the pandemic, the Federal Reserve more than doubled its asset portfolio of mostly Treasury and mortgage securities to a mammoth $9 trillion.

This Wednesday, officials are to announce plans on how they will shrink those holdings. Expect the process to be faster and potentially more disruptive to financial markets than last time.

Dollar Holds Near 20-year High, Euro Struggles

The dollar held near a 20-year high on Monday as the euro struggled around the $1.05 mark, as investors prepared for a busy week of central bank meetings including a likely Federal Reserve interest rate hike.

Investors are expecting the Fed to hike rates by 50 basis points when it meets, and the uncertainty is around how hawkish Fed Chair Jerome Powell will sound in comments following the decision.

April Extends Bond Investors' Woes

The yield on the 10-year U.S. Treasury note logged its biggest monthly increase in more than a decade in April, lifted by mounting expectations for higher interest rates that have deepened the pain for debt investors.

Bond yields, which rise when bond prices fall, have been surging since the start of the year, with few signs of slowing down. Inflation has remained stubbornly high and analysts have ratcheted up forecasts for how aggressively the Federal Reserve will act to tame it.

Florida's $1 Billion Disney Question

When Florida Republicans approved a bill to strip $Disney(DIS.US)$ of its special taxing privileges in April amid controversy over how gender and sexuality are taught in schools, they failed to address a key question: Who is responsible for paying back nearly $1 billion in municipal debt used to build roads, walkways and other infrastructure around Disney World?

U.S. Natural Gas Production Growth Wanes As Need Arises

U.S. natural gas production growth is waning at the same time many countries are looking for new suppliers to help break their dependence on Russian gas after Moscow's invasion of Ukraine.

European Union antitrust authorities have told $Apple(AAPL.US)$that they have formed a preliminary view that it has abused its dominant position in markets for mobile wallets.

The European Commission said that by limiting technology used for contactless payments with mobile devices in stores, Apple restricts competition in the mobile-wallets market.

Berkshire Hathaway Earnings Fall On Investment Losses

$Berkshire Hathaway-A(BRK.A.US)$'s first-quarter earnings fell, hurt by investment losses and weaker results in its insurance-underwriting business.

Warren Buffett's company reported net income of $5.46 billion, or $3,702 a Class A share equivalent. That was down from $11.71 billion, or $7,638 a share, a year earlier. Operating earnings, which exclude some investment results, edged up to $7.04 billion from $7.02 billion last year.

Pfizer, CVS, Starbucks on Deck to Report Earnings in Coming Week

$Pfizer(PFE.US)$, $CVS Health(CVS.US)$ and $Starbucks(SBUX.US)$ are among the companies headlining another busy earnings week as investors continue to digest consumer responses to higher prices and other global issues impacting supplies and raising costs.