Stock futures indicate a quiet start on Wall Street on Wednesday after significant losses on Tuesday. The market could be influenced by the release of FOMC minutes and earnings reports from retailers. Analysts have predicted a 5-10% pullback, which is considered normal after strong gains in the first half of the year. Bond yields are decreasing from recent highs, and oil prices remain low. Traders may be on edge due to the Federal Reserve’s data dependency, as market sentiment fluctuates with each data release.
On Tuesday, strong July sales data raised concerns about a potential rate hike at the Federal Reserve’s September meeting, leading to a decline in the major indices. Manufacturing activity in the New York region contracted more than expected in August, but the outlook index remained optimistic. The sentiment among homebuilders fell to neutral territory. The sell-off affected various sectors, including energy, finance, utilities, and materials.
The market rally in the first half of the year has slowed down, but analysts are not overly concerned. They believe this is a normal consolidation phase before an end-of-year rally. Futures performance on Wednesday shows slight gains in premarket trading. Various economic data releases are scheduled throughout the day. Some stocks to watch include H&R Block, Agilent Technologies, Target Corp, JD.com, TJX Companies, Cisco Systems, Avnet, and Wolfspeed.
In other markets, crude oil futures and the benchmark 10-year Treasury note are experiencing slight declines. Asian markets ended lower, while the central bank of New Zealand kept its official cash rate unchanged but hinted at possible rate hikes in the future. European stocks are showing cautiousness as traders assess economic data, including eurozone GDP.
