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Coffee With Greta: Fed Countdown


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Good morning friends!

Futures are up as traders await the Fed decision.

Let’s get right to it!

Fed Day

Treasury yields are pulling back ahead of today’s Fed decision. 

The 2-year yield is down 3 basis points to 5.07% while the 10-year yield is down 2 basis points to 4.34%.

The decline comes after the 10-year was trading at the highest levels seen since November 2007 on Tuesday. 

The Fed will announce its interest rate decision at 2:00 p.m. ET. 

The Central Bank is widely expected to keep rates unchanged but focus is on the messaging around that pause. 

Traders are looking for more insight on the Fed’s future plans for monetary policy with two more meetings left this year. 

Many are hoping the bank is done hiking rates but officials have so far left the door open for more hikes if the data shows it necessary.

Oil Prices Fall

Oil prices are pulling back ahead of today’s Fed decision. 

West Texas Intermediate crude futures are down 1% to $90.30 bbl with Brent crude futures falling 1.1% to $93.35 bbl.

The price drop comes despite a larger than expected drop in U.S. crude stockpiles last week. 

The American Petroleum Institute reported U.S. inventories fell by 5.25 million barrels last week vs 2.2 million expected. 

Analysts expect prices to continue rallying on supply concerns barring any major surprise from the Fed.

General Mills Tops Fiscal Q1 Expectations

General Mills (GIS) shares are up 0.9% ahead of the open after beating fiscal Q1 expectations on the top and bottom line. 

Here’s how the food company’s results compared to analysts’ estimates: 

  • Adjusted EPS: $1.09 vs $1.08 expected
  • Revenue: $4.9 billion vs $4.88 billion expected

The CEO said, “We delivered growth on the top and bottom lines in the first quarter amid an evolving external environment characterized by moderating inflation, stabilizing supply chains, and a resilient but increasingly cautious consumer.”

General Mills reaffirmed its fiscal 2024 guidance for adjusted operating profit and adjusted earnings growth of 4% to 6%. 

The company expects organic net sales to rise 3% to 4%. 

Mortgage Demand Jumps

Mortgage demand increased last week amid a strange jump in refinance activity despite rates rising higher. 

The Mortgage Bankers Association reported refinance applications jumped 13% weekly but volume was still down 29% year over year. 

Purchase applications rose 2% weekly and were down 26% from a year ago. 

The average 30-year contract fixed rate increased to 7.31% from 7.27%.

In Case You Missed It

  • Instacart (CART) shares rallied 12.3% in the company’s stock market debut on Tuesday. The stock opened on the Nasdaq up 40% at $42 per share before closing at $33.70. Instacart priced the IPO late Monday at $30 per share, valuing the company at about $10 billion. As of Tuesday’s close that market cap jumped to just over $11 billion. CART is down 4.5% ahead of the open.

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