June 27, 2022

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5 things to know before the stock market opens Wednesday, April 6

2 min read

Here are the most important news, trends and analysis that investors need to start their trading day:

1. Stock futures sink in what would add to Tuesday’s drop on Fed worries

Traders on the floor of the NYSE, March 31, 2022.

Source: NYSE

U.S. stock futures dropped Wednesday as investors await more insight into what appears to be a Federal Reserve shifting to an even more aggressive monetary policy tightening path. Minutes from the Fed’s March meeting, which featured the first interest rate hike in more than three years, are out at 2 p.m. ET. The market sees at least 0.25% rate increases at all six of the remaining Fed meetings of the year, with bigger 0.5% rises possible in May and June. Fed Governor Lael Brainard, who normally favors loose policy and low rates, said Tuesday the central bank needs to act quickly and aggressively to drive down inflation. Those comments sent Wall Street lower and bond yields to near three-year highs again.

2. Bond yield rise, pushing up mortgage rates, driving down home loan demand

In fact, 30-year fixed-rate mortgages topped 5% on Tuesday. The rising rate environment sent total home loan application volume down another 6% last week, according to the Mortgage Bankers Association. That’s down 41% from the same week a year ago.

3. Oil CEOs, Yellen to testify at separate hearings on Russia-Ukraine war

Oil prices remained elevated Wednesday on supply concerns as the U.S. and its European allies consider more sanctions against Moscow as allegations emerge about wartime atrocities by Russian troops in Ukraine. The head of the European Council said Russia oil and gas sanctions needed sooner or later. Higher crude prices have, in turn, pushed gasoline prices higher. The CEOs of oil companies, including Chevron and Exxon, are set to testify Wednesday before a House panel about what they’re doing to control energy costs. At another House hearing, Treasury Secretary Janet Yellen is set to talk about the global impact of Russia’s invasion of Ukraine…

2022-04-06 08:38:00

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