U.S. stock futures were slightly lower on Thursday morning following a big decline in the major averages as traders weighed another large rate hike from the Federal Reserve.
Dow Jones Industrial Average futures fell about 5 points. S&P 500 futures lost 0.1% and Nasdaq 100 futures shed 0.3%.
Stocks closed lower on Wednesday, continuing the recent selloff trend as investors evaluated the Fed’s latest comments. The Dow slumped 522 points. Both the S&P 500 and Nasdaq Composite shedding more than 1.7% each, putting both averages at their lowest levels since June 30 and July 1, respectively. The big drop in equities came in a volatile period after the Fed’s third consecutive 0.75 percentage point rate increase.
“Yesterday’s FOMC meeting was a tough pill for markets to swallow and I think this likely continues for three reasons that came out of the Fed,” said Saira Malik, Nuveen’s chief investment officer, citing higher interest rates, inflation, and unemployment.
Policymakers on Wednesday pledged to continue raising rates as high as 4.6% in 2023 before pulling back in the fight against inflation, spurring fears on Wall Street that the economy could tip into a recession as the central bank aims to slow economic growth.
The Fed expects to raise its year-end rate to 4.4% in 2022, continuing aggressive action against rising prices through the remainder of the year.
“I think they should slow down,” DoubleLine Capital CEO Jeffrey Gundlach said Wednesday on CNBC’s “Closing Bell: Overtime.” “Monetary policy has lags that are long and variable, but we’ve been tightening now for a while,” he added, noting that the impact of the tightening could lead to a recession.
On the economic front, the latest data on weekly jobless claims is expected Thursday at 8:30 a.m. ET.
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Accenture (ACN) – The consulting firm reported a better-than-expected quarterly profit and revenue, but gave a weaker-than-expected revenue forecast for the current quarter. Accenture pointed to IT spending cuts by corporate customers and a negative impact from the stronger dollar. Nonetheless, Accenture gained 1% in premarket trading.
STOCK SYMBOL: ACN
Darden Restaurants (DRI) – The parent of Olive Garden and other restaurant chains fell 2.5% in the premarket after reporting in-line quarter results. Darden’s same-restaurant sales rose by 4.2%, short of the consensus FactSet estimate of 5.1%. Food and beverage costs also rose slightly more than expected.
STOCK SYMBOL: DRI
KB Home (KBH), Lennar (LEN) – KB Home and Lennar both reported better-than-expected quarterly earnings, but the home builders also posted lower-than-expected revenue as a housing market slowdown weighed on new home orders. KB Home fell 1.7% in premarket trading, while Lennar gained 1%.
STOCK SYMBOL: KBH
STOCK SYMBOL: LEN
Salesforce (CRM) – Salesforce shares added 1.9% in the premarket after the business software giant unveiled a plan to operate more efficiently and increase profit margins. Salesforce is aiming for a 25% adjusted operating margin for fiscal 2026, compared with the 20% it had targeted for fiscal 2023.
STOCK SYMBOL: CRM
Steelcase (SCS) – Steelcase reported a better-than-expected profit for its latest quarter, but the office furniture company’s revenue came in below estimates. the company also cut its outlook on slower-than-expected return-to-office trends. Steelcase fell 1% in the premarket.
STOCK SYMBOL: SCS
Novavax (NVAX) – The drug maker’s stock slipped 6.1% in premarket trading after J.P. Morgan Securities downgraded it to “underweight” from “neutral”. The firm said the company’s recent guidance cut may not have gone far enough, given reduced vaccine demand as well as other factors.
STOCK SYMBOL: NVAX
H.B. Fuller (FUL) – H.B. Fuller rose 2.2% in premarket trading following a slight earnings beat and revenue that missed estimates. The industrial adhesives maker reported an increase in market share and raised the lower end of its fiscal 2022 earnings range.
STOCK SYMBOL: FUL
Eli Lilly (LLY) – Eli Lilly rose 1.4% in premarket trading after the FDA approved its cancer drug Retevmo for new uses. Separately, UBS upgraded the drug maker’s stock to “buy” from “neutral” for several reasons, including a lowering of risks surrounding the Lilly weight loss drug tirzepatide.
STOCK SYMBOL: LLY
FactSet Research (FDS) – The financial information services provider fell 7 cents shy of estimates with adjusted quarterly earnings of $3.13 per share. However, revenue exceeded Wall Street forecasts as FactSet reported an increase in organic revenue and annual subscription value.
STOCK SYMBOL: FDS
FULL DISCLOSURE:
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DISCUSS!
What’s on everyone’s radar for today’s trading day ahead here at r/stocks?
I hope you all have an excellent trading day ahead today on this Thursday, September 22nd, 2022! 🙂
