© Reuters
By Peter Nurse
Investing.com — U.S. stocks are seen opening lower Wednesday, handing back some of the previous session’s gains after disappointing quarterly results from retail giants Target (NYSE:) and Lowe’s (NYSE:).
At 7 AM ET (1100 GMT), the contract was down 120 points, or 0.4%, traded 20 points, or 0.5%, lower and dropped 90 points, or 0.7%.
The main equity indices closed higher on Wall Street Tuesday, boosted by a strong report for April, suggesting consumers are successfully weathering the sharp rise in inflation so far, good news for retailers which are reporting earnings this week.
The blue-chip closed over 400 points, or 1.3% higher, the broad-based gained 2%, while the tech-heavy rose 2.8%.
This week is a significant one for the retail sector, with Walmart (NYSE:) reporting on Tuesday, hit by rising costs, while Home Depot (NYSE:) sales rose to record levels and it raised its 2022 guidance.
The earnings reports continued Wednesday, with first quarter profit halved and it warned of a bigger margin hit due to rising fuel and freight costs. Home improvement chain also reported a bigger-than-expected drop in same-store sales, as demand eased for its tools and building materials from pandemic highs.
Elsewhere, Netflix (NASDAQ:) will be in focus after the streaming giant announced it has laid off about 150 people, approximately 2% of the company’s workforce in the United States and Canada, as it faces slowing growth.
Investors will also get an updated look at the housing market, with data for and for April due early Wednesday.
U.S. Federal Reserve chief pledged on Tuesday that the U.S. central bank would lift interest rates as high as needed to kill the surge in inflation.
The Fed raised by 50 basis points earlier this month, its second increase of 2022, and the central bank is widely expected to hike by the same amount when it meets again next month.
Oil prices traded higher Wednesday on hopes that China is finally getting to grips with a prolonged COVID-19 outbreak, potentially increasing demand from the world’s largest importer of crude.
Shanghai, China’s main financial hub, achieved its milestone of three consecutive days with no new COVID-19 cases outside quarantine zones on Tuesday and laid out plans to end a more than six-week lockdown.
U.S. crude oil inventories unexpectedly fell by 2.4 million barrels for the week ended May 17, according to data from the industry body .
Investors now await crude oil supply data from the U.S. , due later in the day, for confirmation.
By 7 AM ET, traded 1% higher at $110.70 a barrel, while the contract rose 0.7% to $112.67.
Additionally, fell 0.2% to $1,815.55/oz, while traded 0.3% lower at 1.0518.
Be the first to comment