Here are the most important news, trends and analysis that investors need to start their trading day:
1. Stocks set to jump at open as Wall Street’s wild swings continue
Traders on the floor of the NYSE, Jan. 25, 2022.
Dow futures on Wednesday jumped nearly 350 points, or 1%, as Wall Street waits to hear from the Federal Reserve in the afternoon about its tightening plans after its two-day January meeting. Dow stock Microsoft’s over 4% premarket jump on strong earnings helped boost overall sentiment as a recent stretch of volatility continued. S&P 500 and Nasdaq futures rose roughly 1.5% and more than 2%, respectively.
The Dow Jones Industrial Average on Tuesday closed modestly lower following another volatile session, which saw intraday swings from an over 800-point decline to a more than 220-point advance. The S&P 500 and the Nasdaq on Tuesday closed down more than 1% and over 2%. The Nasdaq sank deeper in a correction.
2. Fed expected to signal March rate hike, further policy tightening
The 30-year Treasury yield, which has moderated recently, ticked higher to over 1.79% early Wednesday. Last week, the benchmark yield topped 1.9% to highs back to January 2020. Concerns about rising inflation and how the Fed is going to further combat it will be front and center in investors’ minds as the central bank releases its policy statement at 2 p.m. ET. Fed Chairman Jerome Powell holds his post-meeting news conference at 2:30 p.m. ET. Fed officials are expected to say they’re ready to increase interest rates from near zero as soon as March after bond-purchase tapering ends. Four hikes are seen this year.
3. Boeing takes $3.5 billion charge; AT&T sees Covid-driven HBO Max boost
Boeing took a $3.5 billion pretax charge on its 787 Dreamliners after production issues prevented the company from delivering the planes to airlines for most of the last 15 months. Before the bell, Boeing also said it generated positive cash flow in the fourth quarter, hitting that milestone earlier than forecast. It was driven by a jump in 737 Max deliveries last year after regulators lifted bans on the jets after two fatal crashes. Boeing reported a much wider-than-expected Q4 loss and missed on revenue.
AT&T on Wednesday morning beat estimates for fourth-quarter adjusted earnings and revenue, boosted by strong growth from Warner Media and its streaming platform HBO Max. The Covid pandemic-triggered shifts to working, studying and playing online have also helped the company sustain strong demand for its wireless services. AT&T hopes to close its deal to combine Warner Media and Discovery into a stand-alone company by mid-2022.
4. Microsoft beats on earnings and revenue, delivers upbeat forecast
Tesla and Dow stock Intel lead the quarterly reports scheduled for release after the bell. Late Tuesday, it was Microsoft’s turn. The tech giant announced fiscal second-quarter earnings and revenue that beat estimates. Microsoft also gave an upbeat forecast for the current quarter, as cloud services revenue continues to post strong growth. The gaming component of Microsoft became more relevant to investors this month, when the company announced plans to acquire Call of Duty maker Activision Blizzard for $68.7 billion. The largest deal in Microsoft’s 46-year history is expected to close in fiscal 2023.
5. Biden to host CEOs at the White House in person to promote stalled BBB
President Joe Biden will meet in person Wednesday with the CEOs of 10 major corporations to discuss the potential benefits to business of his Build Back Better Act, the social safety net bill that passed the House last year but stalled in the Senate. All the CEOs at the meeting support passing the Build Back Better Act, according to a White House official who requested anonymity Tuesday to preview the event that was still being finalized. Among the CEOs expected to attend are General Motors’ Mary Barra, Ford’s Jim Farley, Salesforce’s Marc Benioff and HP’s Enrique Lores.
— Reuters contributed to this report. Follow all the market action like a pro on CNBC Pro. Get the latest on the pandemic with CNBC’s coronavirus coverage.