US stock futures traded lower ahead of Wednesday’s open, as investors sifted through a dovish testimony from Federal Reserve Chairman, Jerome Powell – while President Trump and Kim Jong Un met face-to-face in a Vietnam summit, in which both parties aim to break a stalemate over Pyongyang’s nuclear weapons and end more than 70 years of hostility.
In delivering his semi-annual testimony to the Senate Banking Committee on Tuesday, Powell described the US economic outlook as “generally favorable” but one that faces challenges from abroad – to this, the central back reiterated its shift to a more “patient” approach to monetary policy.
Elsewhere, trading in equity and bond futures were earlier impacted by a 3-hour technical halt at CME Group (CME), the world’s largest exchange operator – the issue affected a slew of markets, from stock-futures, commodities, Eurodollars, metals, grains, crude oil and natural gas.
These declines in pre-market trading look to extend Tuesday’s losses, where US stocks fell as investors weighed a mixed bag of economic data, where downbeat readings on the housing sector signaled a lackluster end to 2018.
Housing starts had fallen to their lowest level in more than two years in December, while home prices grew at their slowest pace in more than three years.
Home Depot (HD: -0.88%), the largest home-improvement retailer, said it expects sales growth to slow in its fiscal 2019 after its quarterly revenue missed Wall Street’s expectations.
The S&P 500 ticked -0.07% lower, with seven of the index’s eleven sectors ending the day in negative territory. Materials (-0.57%), Healthcare (-0.36%) and Energy (-0.32%) were amongst the worst performers.
Meanwhile, the Dow Jones Industrial Average closed -0.13% lower, whereas the Nasdaq Composite ended positive +0.1%.
In today’s economic calendar, another testimony from Jerome Powell, Pending Home Sales figures for January and Oil Inventories for the week are scheduled at 10am EST.
In corporate news, Lowe’s (LOW), Best Buy (BBY) and Campbell Soup (CPB) are among the major companies expected to report their latest figures before the opening bell.
While, Booking Holdings (BKNG), HP (HPQ) and L Brands (LB) are all scheduled to publish their quarterly results after market close.
TODAY’S TOP HEADLINES:
North Korea: President Trump Meets North Korea’s Kim Jong Un at High-Stakes Summit. (The WSJ)
President Trump kicked off a round of high-stakes summitry with North Korean leader Kim Jong Un in his trademark improvisational style, with a one-on-one pre-dinner chat at a hotel in the Vietnamese capital on Wednesday.
Politics: Michael Cohen plans to call Trump a ‘racist,’ a ‘cheat’ and a ‘conman’ in congressional testimony. (CNBC)
President Donald Trump’s former personal lawyer Michael Cohen plans to deliver an explosive testimony before US lawmakers on Wednesday, according to a draft copy of his opening remarks to Congress.
Today’s Economical Announcements
08:30AM – ★★☆ – Goods Trade Balance (Dec) (Previous: -77.25B)
10:00AM – ★★☆ – Cap Goods Ship (MoM) (Previous: 0.5%)
10:00AM – ★★☆ – Factory Orders (MoM) (Dec) (Previous: -0.6%)
10:00AM – ★★★ – Fed Chair Powell Testifies
10:00AM – ★★★ – P. Home Sales (MoM) (Jan) (Previous: -2.2%)
10:30AM – ★★★ – Crude Oil Inventories (Previous: 3.672M)
STOCKS IN THE SPOTLIGHT:
Pre-Market Movers & News Related Stocks
Weight Watchers (WTW): [EARNINGS] Missed estimates by 14 cents, with adjusted quarterly profit of 46 cents per share. Revenue missed forecasts and the company issued weaker-than-expected 2019 revenue guidance.
Mylan (MYL): [EARNINGS] Reported adjusted quarterly profit of $1.30 per share, falling 6 cents a share shy of consensus forecasts. Revenue in line with projections.
Palo Alto Networks (PANW): [EARNINGS] Beat estimates on both the top and bottom lines, with the cybersecurity company seeing a 33 percent jump in its products business and a 29 percent increase in services revenue. It also gave an upbeat revenue forecast.
Dean Foods (DF): [EARNINGS] Reported a quarterly loss of 50 cents per share, nearly twice the 26 cents a share loss that analysts were anticipating. Revenue exceeded forecasts, but Dean said it experienced a significant increase in input costs.
Best Buy (BBY): [EARNINGS] Reported adjusted quarterly profit of $2.72 per share, 15 cents a share above estimates. Revenue beat forecasts.
Campbell Soup (CPB): [EARNINGS] Beat estimates by 7 cents a share, with adjusted quarterly profit of 77 cents per share. Revenue topped forecasts.
Lowe’s (LOW): [EARNINGS] Beat estimates by a penny a share, with quarterly profit of 80 cents per share. Revenue below forecasts.
Office Depot (ODP): [EARNINGS] Earned an adjusted 9 cents per share for its latest quarter, 1 cent a share above estimates. Both revenue and comparable-store sales were below analysts’ forecasts.
Gap (GPS): [NEWS] Gap announced a new $1 billion stock buyback program. The apparel retailer also announced it would maintain its annual dividend at the current 97 cents per share for fiscal 2019.
Papa John’s (PZZA): [EARNINGS] Fell 2 cents a share short of estimates, with adjusted quarterly profit of 15 cents per share. Revenue short of forecasts.
Facebook (FB): [NEWS] Facebook will launch a “clear history” feature later this year, allowing users to erase data related to their interactions with various apps and websites.
Home Depot (HD): [DOWNGRADE] Downgraded to “market perform” from “outperform” at Telsey, which said it came away from the home improvement retailer’s earnings call with concerns that the guidance of a 5 percent comparable sales increase could prove to be too optimistic.
Liberty Global (LBTYA): [NEWS] Liberty is in advanced discussions to sell its Swiss internet and digital TV unit to Zurich-based Sunrise Communications for $6.3 billion, according to a Reuters report.
Wynn Resorts (WYNN): [NEWS] Wynn was fined $20 million in connection with a probe by Nevada regulators into sexual misconduct allegations against former CEO Steve Wynn. It was the largest fine ever assessed by the state’s gambling regulators.
AT&T (T): [NEWS] The Justice Department said it would not appeal Tuesday’s court ruling rejecting its challenge to the approval of AT&T’s acquisition of Time Warner.
Blackstone Group (BX): [NEWS] The private-equity firm and drugmaker Novartis have formed a joint venture to develop drugs that treat blood clots.
GAINERS: SERV, ETSY, FTCH, WP
LOSERS: MEDP, RLGY, ETRN, KHC