Wall Street Set To Stumble At Open As Traders Eye Key Data, Fed Chair Powell's Speech: Analyst Finds 2 Reasons To Stay Optimistic In April

Zinger Key Points
  • Tuesday’s slide took the Dow and the Nasdaq Composite to their lowest levels in about two weeks.
  • Dimming hopes of rate cuts are weighing down on market mood.

Gloom persists on Wall Street as stock futures point to a sluggish start on Wednesday, with the tech space potentially pressured by recent setbacks and the earthquake in Taiwan, home to several tech industry suppliers. Traders also face key data on services and jobs, along with remarks from several Federal Reserve officials.

Cues From Previous Session:

Rate worries weighed heavily on Tuesday, pushing all major averages down by more than 2%. Tuesday’s data releases, including a rebound in manufacturing activity and in-line job openings, reinforced concerns about a strong economy that could prompt the Fed to raise interest rates more aggressively. The indices opened significantly lower and remained flat for most of the session, with the Dow Jones Industrial Average and the S&P 500 ending lower for a second consecutive day.

The sell-off was broad-based, with consumer discretionary, healthcare, and real estate stocks leading the decline. Energy stocks, on the other hand, rallied strongly on continued oil price strength, while utility and communication services edged higher.

The Dow and Nasdaq Composite closed at their lowest points in two weeks, reflecting broader market anxieties.

IndexPerformance (+/-)Value
Nasdaq Composite-0.95%16,240.45
S&P 500 Index-0.72%5,205.81
Dow Industrials-1.00%39,170.24
Russell 2000-1.80%2,065.04

Insights From Analysts:

Notwithstanding the recent lean patch, a fund manager is optimistic about a near-term recovery. “Spring is a happy time of year.  This good feeling rubs off on the stock market since April is a seasonally strong month,” said fund Louis Navellier. Citing Bespoke data, he said the Dow Industrials has posted an average April gain of 2.2% in the past 50 years. 

Navellier also sees another reason to be optimistic. “The other reason that April is such a strong month is due to annual pension funding before taxes are filed,” he said.

Futures Today

Futures Performance On Wednesday ( as of 7 a.m. EDT)

FuturesPerformance (+/-)
Nasdaq 100-0.21%
S&P 500-0.07%

In premarket trading on Wednesday, the SPDR S&P 500 ETF Trust SPY slipped 0.05% to $518.35, and the Invesco QQQ ETF QQQ fell 0.23% to $440.11 according to Benzinga Pro data.

Upcoming Economic Data:

ADP is scheduled to release its March private payrolls report at 8:15 a.m. EDT. Economists, on average, expect, the private sector to have added 155,000 jobs compared to the 140,000 number for February.

S&P Global will release its final service sector PMI for March at 9:45 a.m. EDT. The flash reading released last month came in at 51.7, down from 54.6 in February.

The ISM’s non-manufacturing PMI, due at 10 a.m. EDT, is widely expected to remain flattish at 52.7 for March.

The Energy Information Administration will release its customary weekly petroleum status report at 10:30 a.m. EDT.

Among the Fed speeches for the day are:

  • Fed Governor Michelle Bowman: 9:45 a.m. EDT
  • New York Fed President John Williams: noon EDT
  • Fed Chair Powell: 12:10 p.m. EDT
  • Fed Vice Chair for Supervisions Michael Barr: 1:10 p.m. EDT

See also: Best Futures Trading Software

Stocks In Focus:

  • Dave & Buster’s Entertainment, Inc. PLAY rallied over 7% in premarket trading following its results announcement, and Cal-Maine Foods, Inc. CALM jumped over 8%.
  • Acuity Brands, Inc. AYI slipped nearly 2% in reaction to its quarterly results.
  • BlackBerry Limited BB, Levi Strauss & Co. LEVI, and Resources Connection, Inc. RGP are among the companies due to release their quarterly earnings on Wednesday.
  • Tesla, Inc. TSLA declined about 1% in the follow-through sell-off post-first-quarter deliveries report.
  • Chipmaker Intel Corp. INTC fell over 4% after its foundry unit posted a nearly $7 billion operating loss in 2023
  • Nvidia Corp. NVDA and Advanced Micro Devices, Inc. AMD also slipped after their foundry Taiwan Semiconductor Manufacturing Company Limited TSM was forced to evacuate its factory following an earthquake in the country.

Commodities, Bonds, and Global Equity Markets:

Crude oil futures rallied yet again on Wednesday and were closing in on the $86-a-barrel mark, while gold futures continued their record run. The yield on the benchmark 10-year Treasury remained flattish after the surge on Tuesday.

Bitcoin BTC/USD was flatlining and traded shy of the $66,000 level.

In equity markets, Asian stocks fell across the board on souring rate-cut hopes, while the major European stocks traded mostly higher amid the release of some weak domestic economic data.

Read Next: Historic S&P 500 Rally In Q1 Flashes Bullish Signals For 2024: ‘Only The Ninth Time Since 1940’

Photo by Tada Images on Shutterstock

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