Wall Street points lower as markets digest earnings ahead of Fed meeting

Wall Street pointed modestly lower early Tuesday as investors digested more corporate earnings reports while keeping their eyes on potentially market-moving reports later this week. Futures for the Dow Jones Industrial Average and the S&P 500 each ticked back 0.1%.

Quick Read

• Wall Street futures pointed modestly lower as investors evaluated fresh corporate earnings and anticipated the upcoming Federal Reserve meeting.
• McDonald’s shares dropped slightly in premarket trading after reporting strong U.S. sales but missing profit expectations, partly due to a boycott in Muslim-majority markets.
• 3M’s stock surged 7.6% following better-than-expected sales and profit results and positive full-year guidance after spinning off its health care business.
• HSBC’s shares rose 4.2% as the bank announced the upcoming retirement of CEO Noel Quinn, who led significant divestitures and strong financial returns.
• Coca-Cola’s stock remained steady after exceeding sales and profit forecasts.
• Key earnings reports expected include Amazon and Starbucks, set to release their financial results after Tuesday’s market close.
• The market is also focused on the Federal Reserve’s next policy decision and Jerome Powell’s subsequent press conference, with high inflation tempering expectations for rate cuts.
• Global markets showed mixed responses, with European indices mostly down and Asian markets like Japan’s Nikkei showing gains.
• The upcoming U.S. jobs report is also a critical focus, with hopes that it will indicate a balance strong enough to stave off recession yet controlled enough to not exacerbate inflation.
• In commodities, both U.S. and Brent crude oil prices saw slight increases.

The Associated Press has the story:

Wall Street points lower as markets digest earnings ahead of Fed meeting

Newslooks- NEW YORK- (AP)

Wall Street pointed modestly lower early Tuesday as investors digested more corporate earnings reports while keeping their eyes on potentially market-moving reports later this week. Futures for the Dow Jones Industrial Average and the S&P 500 each ticked back 0.1%.

McDonald’s slipped less than 1% in premarket after the burger chain reported strong U.S. sales, but fell short of Wall Street profit targets. International sales fell as customers across the Middle East and in Muslim-majority markets have been boycotting McDonald’s for months over its perceived support for Israel.

3M jumped 7.6% after its sales and profit came in ahead of Wall Street forecasts. The maker of industrial, safety and consumer goods also issued full-year sales and profit guidance reflecting the spinoff of its Solventum health care business earlier in April.

Europe’s largest bank, HSBC, rose 4.2% after it announced that CEO Noel Quinn plans to retire after serving nearly five years in the post. Quinn oversaw the sale of HSBC’s Canada and Argentina operations and oversaw the bank’s strongest returns in more than a decade.

Coca-Cola shares barely budged after the beverage giant topped analysts’ sales and profit forecasts.

Amazon and Starbucks report their latest financial results after the bell Tuesday.

Markets are also anxiously awaiting the U.S. Federal Reserve’s latest policy decision on Wednesday.

Reports of stubbornly high inflation have traders expecting fewer interest rate cuts this year. The U.S. central bank’s main interest rate is at its highest level since 2001. Fed Chair Jerome Powell could offer more color in his news conference following the central bank’s decision.

Also on investors’ minds is the jobs report hitting Wall Street on Friday that could show hiring by U.S. employers cooled in April and that growth in workers’ wages held relatively steady.

The hope on Wall Street is that the job market will remain strong enough to help the economy avoid a recession but not so strong that it feeds upward pressure into inflation.

In Europe at midday, France’s CAC 40 edged down 0.1% in early trading, while Germany’s DAX fell 0.4%. Britain’s FTSE 100 added 0.5%.

Japan’s benchmark Nikkei 225 jumped 1.2% to finish at 38,405.66, coming back from a national holiday. Sydney’s S&P/ASX 200 rose 0.4% to 7,664.10. South Korea’s Kospi added 0.2% to 2,692.06. Hong Kong’s Hang Seng edged up 0.1% to 17,763.03, while the Shanghai Composite fell 0.3% to 3,104.82.

In Japan, the government reported stronger than expected gains in industrial production with a seasonally adjusted 3.8% rise in March from the previous month.

“Weak manufacturing weighed on growth in the first quarter of the year, but we think that consumption is likely to improve on the back of healthy labor market,” said Min Joo Kang, senior economist at ING.

In energy trading, benchmark U.S. crude added 25 cents to $82.88 a barrel. Brent crude, the international standard, rose 29 cents to $87.49 a barrel.

In currency trading, the U.S. dollar rose to 156.91 Japanese yen from 156.28 yen. The euro cost $1.0721, down a touch from $1.0725.

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