US Stocks Could Lose Momentum Thursday As Futures Trade Flat Ahead Of Powell Speech — Tesla, GameStop In Focus

Zinger Key Points
  • After a bargain hunting-aided rebound on Wednesday, sentiment has turned back to one of caution.
  • More Fed speeches, including one from Fed Chair Jerome Powell is on Thursday's agenda.

The major U.S. index futures are little changed on Thursday, as apprehensions return after Wednesday’s strong advances. Investors are left to contend with more Fed speeches, while the corporate news flow remains fairly light.

On Wednesday, U.S. stocks opened mostly higher and stayed above the unchanged line for the bulk of the session, before closing notably higher.

The gains helped the Nasdaq Composite break a seven-session losing streak, the longest since 2016. Some of the positivity could be traced back to the slip back in the U.S. Treasury yields. The yield on the benchmark 10-year Treasury note eased to 3.265% from 3.34% on Tuesday, apparently as investors priced in a letup in inflationary pressure.

That said, Fed officials stuck to their hawkish stance and signaled that more rate hikes could be in the offing.

Taking a different stance, Ark Invest founder Cathie Wood warned that the central bank could be making a mistake by acting hastily and aggressively to curb 2-year-long COVID-supply-shock inflation. She suggested we could be entering a deflationary environment by the end of the year.

U.S. Indices' Performance On Wednesday
Index Performance (+/-)   Value
Nasdaq Composite +2.14%   11,791.90
S&P 500 Index +1.83%   3,979.87
Dow Industrials +1.40%   31,581.28

Here’s a peek into index futures trading:

U.S. Futures' Performance On Thursday During Premarket Session
Index Performance (+/-)  
Nasdaq 100 Futures -0.01%  
S&P 500 Futures +0.03%  
Dow Futures +0.03%  
R2K Futures -0.59%  

In premarket trading on Thursday, the SPDR S&P 500 ETF Trust SPY was rising 0.03% to $397.91 and the Invesco QQQ TrustQQQ was moving up 0.03% to $299.05, according to Benzinga Pro data.

Fed officials once again take the center stage on Thursday. Fed Chairman Jerome Powell is scheduled to speak on the topic “The State of Monetary Policy After 40 Years” at 9:10 a.m. ET.

Chicago Fed President Charles Evans will make a public appearance at 12 p.m. ET and will also participate in a moderated Q&A session on economic conditions and monetary policy.

Investors could keep an eye on the jobless claims report for the week ended Sept. 3. Economists widely expect the number of people filing for unemployment benefits to increase from 232,000 to 240,000.

A central bank decision from across the Atlantic could also be closely watched by investors. The European Central Bank is scheduled to announce its monetary policy decision at 8:15 a.m. ET. The bank is widely expected to lift the key rate by 75 basis points to 1.25%.

See also: Will The Fed Funds Rate Continue To Go Up? Fed Officials Weigh In On How To Reduce Inflation

Stocks In Focus:

  • Tesla, Inc. TSLA shares could be in focus after data released by an industry association showed a strong rebound in the company’s wholesale sales in China.
  • Meme stock GameStop Corporation GME was seen advancing in reaction to its results released late Wednesday.
  • Notable earnings scheduled for the day include that from FuelCell Energy Company FCEL, Chinese video sharing company Bilibili, Inc. BILI and cloud security provider Zscaler, Inc. ZS.

Commodity, Global Markets:

After a 5.69% plunge to a 7-month low on Wednesday, crude oil futures are seen recouping their losses but are yet moderately lower. The commodity is getting a boost from Russian President Vladimir Putin’s statement that Russia will not supply oil to countries that supported a cap on the oil output from the nation.

The Asian markets rallied across the board, encouraged by the notably positive close by Wall Street overnight. However, the Chinese and Hong Kong market bucked the downtrend.

European stocks are mixed in early trading as investors await the Key ECB rate decision.

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Posted In: EarningsNewsPenny StocksFuturesPreviewsSmall CapTop StoriesEconomicsFederal ReservePre-Market OutlookMarketsTrading IdeasCathie WoodJerome Powell