Editorial StaffStock futures fluctuate as investors pause ahead of this week’s Federal Reserve gathering; Salesforce and Snowflake report earnings; GameStop and AMC surge in a renewed rally of meme stocks.
1. — Stock Futures Fluctuate Ahead of Fed Retreat
Stock futures fluctuated Wednesday, a day after Wall Street hit fresh record highs as investors paused ahead of a Federal Reserve gathering at the end of the week.
Contracts linked to the Dow Jones Industrial Average rose 14 points, S&P 500 futures were down 2 points and Nasdaq futures declined 15 points. The Nasdaq passed 15,000 for the first time on Tuesday.
The yield on the benchmark 10-year Treasury rose Wednesday to 1.306% as traders looked to the Jackson Hole symposium later in the week for hints on future Federal Reserve policy.
Some Fed officials believe it would be appropriate for the central bank to begin tapering asset purchases this year, while others said they preferred to wait for more solid economic data, especially on employment.
Investors are looking to a speech Friday Fed Chairman Jerome Powell at the symposium on Friday for hints on when the Fed might pulling back on its massive bond buying program. The Fed has been buying about $120 billion a month of Treasury securities and mortgage bonds to help prop up the economy during the pandemic.
The Jackson Hole retreat was changed to a virtual format because of rising coronavirus cases caused predominantly by the highly contagious delta variant
“Moving Jackson Hole back to an entirely virtual format this year is telling us that Fed officials are taking the delta variant seriously,” said LPL Financial fixed income strategist Lawrence Gillum. “We’ll have to see if that alters the tapering timeline and importantly the market’s expectations for when the Fed will start to increase short-term interest rates.”
2. — Wednesday’s Calendar: Salesforce and Snowflake Earnings, Durable Goods Orders
Earnings reports are expected Wednesday from Salesforce.com, Snowflake, Autodesk, Splunk, Ulta Beauty, Williams-Sonoma, Dick’s Sporting Goods, Box and Zuora.
3. — GameStop and AMC Surge in Renewed Meme Stock Rally
Shares of both GameStop and AMC Entertainment extended gains Wednesday after the stocks, popular on social media forums like Reddit’s WallStreetBets, surged during the previous session.
GameStop jumped 27.53% on Tuesday to $210.29, its highest close since June 30, even though no material news was released. The stock had its best day in five months. Movie theater chain AMC surged more than 20%.
Trading volume in both stocks also jumped. Roughly 14 million GameStop shares changed hand, more than 10 times the amount typically traded over the past five sessions, according to Bloomberg. AMC surpassed 200 million shares traded for the first time since mid-June.
GameStop was up another 1.6% in premarket trading Wednesday, while AMC tacked on another 4.38%.
Robinhood Markets, which has benefited greatly from the trading of so-called meme stocks, rose more than 9% on Tuesday. Many analysts, initiating coverage on the stock earlier this week, lauded the investment platform’s potential, even after a disappointing earnings report.
4. — Goldman Sachs Requires Employees to Get Vaccinated and Wear Masks
Goldman Sachs will require employees and visitors to its offices to be vaccinated against COVID-19 beginning Sept. 7.
In a memo to employees Tuesday, Goldman Sachs said it also
was instituting a mask requirement for all common areas starting Wednesday, The Wall Street Journal reported.
Employees who aren’t fully vaccinated by Sept. 7 must work from home, the memo
said.
Bloomberg noted how Goldman’s decision means all six U.S. banking giants now have instituted some sort of broad mandate that employees get shots or wear masks inside buildings, or in some cases do both.
Morgan Stanley in July began requiring employees and visitors to confirm their vaccination status to enter its offices in New York. JPMorgan Chase
hasn’t made vaccines mandatory but does ask employees their vaccination
status. The bank earlier this month reinstituted a mask mandate in its U.S.
offices, regardless of vaccination status, the Journal noted.
5. — Nordstrom Raises Outlook but Stock Slumps
Nordstrom was slumping in premarket trading Wednesday even after the retailer reported that it swung to a profit in its fiscal second quarter as revenue doubled.
The company also raised its full-year outlook, saying it expects revenue to increase 35%, up from prior guidance of 25% growth.
The stock fell 7.83% to $34.85 in premarket trading.
Nordstrom said it expects EBIT margin for the year at 3% to 3.5% of sales, vs. prior guidance of 3%.
Source: The Street
