US Stocks Head For Another Rough Day As Recession, Rate Worries Dampen Sentiments; Apple, Tesla, Pinterest In Focus Today

Zinger Key Points
  • Stocks could show a lack of direction until traders see off a duo of inflation reports and Wednesday's FOMC meeting.
  • If the Fed's signal concerning interest rate align with that of the market, stocks could finish the year stronger.

The index futures point to another down day on Wall Street on Wednesday ahead of key catalysts coming on Friday and early next week.

Stocks pulled back yet again on Tuesday as worries concerning the economy's health and a rising rate environment triggered a sell-off.

The S&P 500 Index and the Nasdaq Composite Index settled at a one-month low, while the Dow Industrials closed at its lowest since Nov. 17. Most sectors moved to the downside, led by technology, communications and energy stocks. Meanwhile, utility stocks gained ground in the session.

U.S. Indices' Performance On Tuesday
Index Performance (+/-)   Value
Nasdaq Composite -2.00%   11,014.89
S&P 500 Index -1.44%   3,941.26
Dow Industrials -1.03%   33,596.34

If the Fed raises the fed funds rate by 50 basis points next week, the central bank will be near parity or neutral, Fund manager Louis Navellier said. A 50-basis-point hike will take Fed rates to 4.25%-4.50% and the 10-year Treasury note yield is currently around 3.5%, he noted.

"If the FOMC statement mentions dovish words like parity or neutral, the stock market could stage a massive relief rally. But the FOMC never fights market rates, so I remain in the camp that December will be the Fed's last key interest rate hike," he added.

Here's a peek into index futures trading:

U.S. Futures' Performance On Wednesday During Premarket Session
Index Performance (+/-)  
Nasdaq 100 Futures -0.36%  
S&P 500 Futures -0.28%  
Dow Futures -0.18%  
R2K Futures -0.50%  

In premarket trading on Wednesday, the SPDR S&P 500 ETF TrustSPY fell 0.21% to $393.02 and the Invesco QQQ TrustQQQ moved down 0.38% to $280.60, according to Benzinga Pro data.

On the economic front, the Mortgage Bankers Association is scheduled to release its mortgage applications volume data for the week ended Dec. 2 at 7 a.m. EST. In the previous week, the measure fell 0.8% week-over-week.

The Labor Department is scheduled to release its final third-quarter productivity and costs report at 8:30 a.m. EST.

The Energy Information Administration is set to release its weekly crude oil inventories report at 10:30 a.m. EST.

At 3 p.m. EST, the Federal Reserve will release its consumer credit report for October.

See also: How To Invest In Startups

Stocks In Focus:

  • Apple, Inc. AAPL moved down about 0.75% in premarket trading after one of its suppliers hinted at a demand slowdown for iPhones.
  • Tesla, Inc. TSLA fell over 1.75%, signaling a third straight session of decline. The company announced an additional discount for Chinese customers.
  • MongoDB, Inc. MDB climbed about 27% in reaction to its third-quarter results released after the close.
  • Pinterest, Inc. PINS gained close to 2% after the social media platform reached a truce with activist investors Paul Singer-led Elliott Management.
  • Chinese e-commerce stocks Alibaba Group Holding Limited BABA,, Inc. JD, Bilibili, Inc. BILI moved to the downside following recent gains achieved on the back of COVID-19 easing news in China.
  • United Natural Foods, Inc. UNFI and Campbell Soup Company CPB are among the notable companies reporting earnings ahead of the market open.

Commodities, Other Global Equity Markets:

Crude oil futures were down for a fourth straight session, with a barrel of WTI-grade crude oil trading down over 1% at $73.38. The weakness in black gold can be traced back to worries concerning tempered demand amid weakening economic growth.

The global markets followed Wall Street lower, with the Asia-Pacific markets ending uniformly lower. European stocks traded moderately lower in late-morning deals.

Read Next: Rate Cuts May Not Come Anytime Soon, Cramer Says: 'Fed's Not Going To Stop Tightening Until…'

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