Tuesday June 15th


U.S. stock futures are flat ahead of the Fed meeting

U.S. stock index futures were flat on Tuesday ahead of the Federal Reserve’s latest monetary policy meeting. The pause comes a day after the Nasdaq Composite and S&P 500 registered new record highs. S&P 500 futures were flat. Nasdaq 100 futures added less than 0.1%. Dow Jones Industrial average futures were lower by about 16 points. There were very few standout premarket performers. Some reopening plays, such as Boeing and cruise lines, traded slightly higher early Tuesday. Investors will also be watching for another inflation gauge released on Tuesday. The Producer Price Index — which measure the prices paid to producers as opposed to prices on the consumer level — is expected to rise 0.5% in May, according to Dow Jones estimates. The core PPI — which excludes volatile items like foods, energy and trade services — is estimated to increase 0.4%. May’s retail sales data are also slated for release at 8:30 a.m. ET. Economists polled by Dow Jones are expecting a drop of 0.7% for last month. Excluding autos, economists expect May’s retail sales rose 0.5%, economists expect. Retail sales in April were unchanged as the boost from stimulus checks faded. On Monday, S&P 500 gained 0.2% to close at a new record of 4,255.15. The Dow, however, fell 85 points. The Nasdaq Composite was the relative outperformer, gaining 0.8% to close at an all-time high of 14,174.14. Investors are pouring back into growth stocks as bond yields keep falling. The 10-year Treasury rate hit a three-month low last Friday and hovered around 1.5% on Monday. Yields were lower again on Tuesday. Bitcoin rose to $40,000 on Monday after Tesla CEO Elon Musk said Sunday that the company will resume bitcoin transactions once it confirms there is reasonable clean energy usage by miners. The Federal Reserve’s two-day policy meeting starts on Tuesday, and it’s a focal point for the markets this week. The central bank is not expected to take any action. However, commentary on interest rates, inflation and the economy could drive market moves. Traders will listen closely for comments on inflation and the Fed’s eventual tapering plans. Billionaire hedge fund manager Paul Tudor Jones told CNBC on Monday that this Fed meeting could be the most important in Chairman Jerome Powell’s career. Tudor Jones also warned that Powell could spark a big sell-off in risk assets if he doesn’t do a good job of signaling a taper in the Fed’s monthly asset buying. Shares in Asia-Pacific were mixed in Tuesday afternoon trade, with Australian and Japanese stocks leading gains regionally. The Nikkei 225 in Japan gained 0.96% to finish the trading day at 29,441.30 while the Topix index advanced 0.8% to close at 1,975.48. South Korea’s Kospi edged 0.2% higher on the day to 3,258.63. Elsewhere, mainland Chinese stocks closed lower, with the Shanghai composite slipping 0.92% to 3,556.56 while the Shenzhen component dipped 0.864% to 14,673.34. Hong Kong’s Hang Seng index declined about 0.6%, as of its final hour of trading. Oil prices rose on Tuesday, with Brent gaining for a fourth consecutive session, as the prospect of extra supply coming to the market soon from Iran faded with talks dragging on over the United States rejoining a nuclear agreement with Tehran. Brent crude was up by 61 cents, or 0.8%, at $73.47 per barrel, having risen 0.2% on Monday. U.S. oil gained 55 cents, or 0.8%, to $71.43 a barrel, having slipped 3 cents in the previous session. Gold prices held in a tight range on Tuesday ahead of a U.S. Federal Reserve meeting that could provide an indication on the eventual withdrawal of economic support. Spot gold was down 0.1% at $1,863.36 per ounce by 0901 GMT, after falling to its lowest since May 17 at $1,843.99 on Monday. U.S. gold futures were flat at $1,865.70 per ounce.