Coffee With Greta: Traders Brace for Turmoil
DJIA Futures: +199 (+0.6%)
SPX Futures: +25 (+0.6%)
NASDAQ Futures: +68 (+0.6%)
Good morning friends!
Futures are higher as the market looks to break its 3-week losing streak.
Let’s get right to it!
Traders Brace for Turmoil
Stocks are on track to open higher after the major indexes logged three straight weeks of losses.
The holiday-shortened week will still be focused on interest rates as several Fed officials are set to speak.
CME Group’s FedWatch Tool shows 68% of traders expecting another 0.75% rate hike at the September 21 meeting.
Investor Bill Ackman told CNBC this moring, there are signs inflation is calming.
Ackman said, “Our biggest fear was inflation, and that’s why I wanted the Fed to raise rates quickly and soon. They’re now doing this, I think they have to [continue].”
Treasury Yields Push Higher
U.S. Treasury yields are rising today as the market awaits new economic data.
The 2-year yield is up 8 basis points to 3.48% while the 10-year yield is up 7 basis points to 3.27%.
The Institute for Supply Management and S&P Global are both set to release their August purchase managers’ index for the services sector at 10:00 a.m. ET.
The data comes amid continued concerns about an economic slowdown caused by the Fed’s actions against inflation.
Bed Bath & Beyond Drops After CFO’s Death
Bed Bath & Beyond (BBBY) shares are dropping 14.8% in premarket trade following the death of its CFO over the weekend.
Police said Gustavo Arnal died Friday after falling from a building in Manhattan which the medical examiner’s office later ruled a suicide.
Bed Bath & Beyond said in a statement that Arnal “was instrumental in guiding the organization throughout the coronavirus pandemic.”
His death comes as the struggling company is attempting to turn around its business.
Bed Bath announced last week it had secured more than $500 million in new financing and revealed a turnaround strategy.
But analysts said that strategy was not sufficient for reviving the business.
CVS to Buy Signify Health
CVS Health (CVS) shares are up 1.5% ahead of the open after announcing on Monday it has reached a deal to acquire Signify Health (SGFY).
CVS will pay $30.50 per share in cash for Signify, valuing the company at about $8 billion.
The CVS Health President and CEO said, “This acquisition will enhance our connection to consumers in the home and enables providers to better address patient needs as we execute our vision to redefine the health care experience.”
The companies expect the acquisition to close in the first half of 2023.
SGFY shares are down 0.3% in premarket trade.
Oil Prices Drop on Demand Fears
Oil prices are lower today as demand fears take over the market once again.
West Texas Intermediate crude futures are down 0.3% to $86.50 bbl while Brent crude futures are down 2.9% to under $93 bbl.
The demand worries come as new Covid restrictions in China have added to concerns over rate hikes.
The European Central Bank is expected to approve a sharp rate hike later this week while the Fed is expected to do the same later this month.
The demand fears are overpowering worries about supply after OPEC+ approved its first supply cut since 2020 on Monday.
The group voted to cut its October output target by 100,000 barrels per day.