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Fed speak ahead, Disney to report — what’s moving markets
This report was created by OXShare
On Wednesday, U.S. futures remained steady, as remarks from Federal Reserve officials dampened some investor confidence that has been driving a sustained upward trend on Wall Street. Traders will be closely following Federal Reserve Chair Jerome Powell’s statements later today, in an effort to assess the central bank’s expected future interest rate trajectory. In addition, Walt Disney is set to release its most recent quarterly earnings report, and Democrats achieve important wins in off-year elections.
  1. Futures hover around flatline
On Wednesday, U.S. stock futures remained steady, as investors assessed how long the recent rally on Wall Street would continue, considering that it had already carried over to the previous session.
At 5:01 Eastern Time (10:01 Greenwich Mean Time), the Dow futures were relatively unchanged, while the S&P 500 futures had decreased by 2 points or 0.1%, and the Nasdaq 100 futures had dropped 12 points or 0.1%.
On Tuesday, the S&P 500 and Nasdaq Composite indexes continued their winning streak for the seventh and eighth day in a row, respectively. This is the longest period of consecutive gains for both indices since 2021. Similarly, the Dow Jones Industrial Average, which consists of 30 stocks, recorded its seventh consecutive day of positive performance.
Traders are feeling optimistic because they believe the Federal Reserve might lower interest rates soon due to recent economic data. However, a few officials from the Fed have mentioned that the better-than-expected third-quarter growth in the United States might actually require tighter regulations or even an additional increase in interest rates.
  1. Powell comments in focus
Federal Reserve Chair Jerome Powell is scheduled to speak at different conferences in Washington D.C. during the next two days. Market participants are eager for him to provide more insight into his evaluation of the Federal Reserve’s forthcoming interest rate choices.
In his statement following the Federal Reserve’s decision to maintain interest rates, Powell emphasized that the U.S. central bank will maintain borrowing costs at a level that is enough to restrict the economy. The aim is to reduce inflation and bring it closer to the target of 2%.
He mentioned that he still had doubts about whether the Fed had successfully reached that position, but he acknowledged that officials will proceed cautiously before making any future changes to interest rates.
Fed Governor Christopher Waller indicated that a surge in U.S. gross domestic product (GDP) of 4.9% on an annualized basis during the third quarter could significantly influence the central bank’s future policy decisions.
Another Federal Reserve Governor, Michelle Bowman, also acknowledged the GDP number and suggested it might indicate that the U.S. economy is growing at a faster pace. She reinforced her endorsement of raising interest rates further, especially if the recent decrease in inflationary pressures seems to be losing momentum.
  1. Disney earnings ahead
Walt Disney is scheduled to announce its most recent quarterly earnings on Wednesday after the market closes.
Bob Iger, the CEO of Disney, could potentially be questioned about his plan to rejuvenate the company, as it has been struggling with declining performance in its conventional TV offerings and underwhelming growth in its streaming services. Over the past year, Disney’s stock has dropped by a considerable 15%.
Iger has mentioned before the possibility of selling off certain assets that are not considered essential to Disney, such as its ABC television property. Disney has also declared that it will be acquiring Comcast’s one-third stake in Hulu, a leading TV company. This acquisition will grant Disney complete ownership of the streaming group.
Iger is focused on increasing profits at Disney’s successful international theme parks and cruises division by investing in new attractions and raising ticket prices. Despite a decrease in American visitors this summer, Iger views the parks and experiences unit as a vital part of the company that has balanced out any weaknesses in other areas.
The Democrats achieve electoral victories during non-presidential election years.
Governor Andy Beshear has managed to win another term in office in Kentucky, showcasing a series of successes for the Democratic party that has been facing challenges due to declining poll figures for President Joe Biden.
In a state that is typically known for its conservative beliefs and overwhelming support for former Republican president Donald Trump in the 2020 presidential election, Beshear, a Democrat, managed to secure a second term as the elected official.
In another location, the people of Ohio supported a measure to protect the right to abortion, which has been a significant topic in Democratic communication, within the constitution of the state.
According to a report by the Associated Press referred to as a Wall Street Journal tally, the Democrats in Virginia were aided by the discussion surrounding reproductive rights, resulting in them gaining complete control over the state’s legislature.
According to recent polls, Biden is currently behind Trump in five out of the six crucial swing states that could ultimately decide the outcome of the 2024 presidential election. Despite the negative polling data, Biden disregarded these results after the recent elections. However, reports indicate that Democrats have expressed private concerns about his prospects for next year.
The price of crude oil falls following a significant increase in inventories in the United States.
On Wednesday, the price of oil decreased as there was an unexpected increase in U.S. crude supplies, leading to worries about a potential decline in demand from the world’s biggest consumer.
According to information provided by the American Petroleum Institute, a trade association representing the petroleum industry, there was a significant increase of nearly 12 million barrels in U.S. crude oil reserves the previous week. This amount exceeded predictions of a decrease of 300,000 barrels.
The data released by the U.S. Energy Information Administration on a weekly basis will be postponed until the week starting from November 13th.
U.S. crude futures experienced a 0.3% decline, trading at $77.15 a barrel at 05:02 ET. Similarly, the Brent contract also saw a decrease of 0.2% and was valued at $81.49 per barrel.
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