Stocks see-saw, FedEx’s dividend hike, Fed in focus: LIVE UPDATES
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U.S. stocks ended mixed in what was a choppy session ahead of the Federal Reserve’s decision on an interest rate hike Wednesday. The Dow Jones Industrial Average and the S&P 500 slipped while the Nasdaq Composite posted a modest gain. FedEx was a standout rising 14% after boosting its dividend by 53%. In commodities, oil closed at $118.93 per barrel.
Euro Pacific Capital chief economist Peter Schiff provides insight on Bitcoin cryptocurrency and how the Federal Reserve should respond to inflation on 'Making Money.'
North Carolina Agriculture Commissioner Steve Troxler expresses concerns that 'people can't afford to eat' amid rising commodity prices.
Former White House OMB Director Russ Vought assesses the culprits behind the U.S.'s runaway inflation and the possibility of a 75-basis point rate hike from the Fed.
FedEx hiked its dividend by 53% to $1.15 per share rewarding shareholders and putting shares on pace for largest percent increase since July 14, 1993, when it rose 13.87%.
The dividend is payable on July 11, 2022, to stockholders of record as of the close of business on June 27, 2022.
Autotrader.com executive editor Brian Moody argues a car sales decline coupled with rising inventory could ease prices.
The Dow Jones Industrial Average and the S&P 500 paired gains midday as utilities and consumer staples fell. Procter & Gamble and Coca-Cola topped the decliners in the Dow, while Chevron and McDonald's rose.
U.S. stocks rebounded after a heavy day of selling that pushed the S&P 500 into a bear market, this as the Federal Reserve begins day one of its two-day meeting. Helping sentiment, a positive earnings report from Oracle and a 53% dividend hike by FedEx. In commodities, oil rose to $120 per barrel.
Coinbase CEO Brian Armstrong announced that 18% of his staff will be cut due to economic and market conditions. Bitcoin has seen a sharp decline, along with other cryptocurrencies, and is now trading around the $22,000 level.
U.S. equity futures are trading higher as stocks look to rebound from Monday's steep sell-off.
Dow Jones Industrial Average futures are up 75 points while S&P 500 and Nasdaq futures are higher by 0.4% and 0.7%, respectively.
Meanwhile, oil prices are higher. West Texas Intermediate crude futures are trading at $121.89 a barrel and Brent crude is trading around $123 per barrel.
After a precipitous drop in value Monday, Bitcoin, Ethereum and Dogecoin were all higher overnight.
Bitcoin and other cryptocurrencies have struggled in sympathy with the broader stock market, which is contending with scorching-hot inflation.
The Federal Reserve, which has already begun hiking interest rates to bring inflation down, will offer an update on its outlook for the economy this week following its two-day policy-setting meeting.
As of 4:15 a.m. ET Tuesday, Bitcoin was trading at nearly $23,000 (+0.92%), or up almost $222. For the week, Bitcoin was down 28.31% and for the month, it was down 23.13%.
Ethereum was trading at approximately $1,225 (+1.94%), or up almost $22.50. For the week, Ethereum was down more than 35.25% and for the month, it was down more than 40%.
Dogecoin was trading at approximately $0.057 (+6.66%), or up $0.0035. For the week, Dogecoin was down about 35.25% and for the month, it was down nearly 40%.
The price of a gallon of regular gasoline hit an historic milestone over the weekend and continued to move higher early Tuesday, reaching $5.016 per gallon.
The price on Monday morning rose to $5.014, according to AAA, and Sunday morning hit $5.01.
Gas hit the $5 mark on Saturday morning for the first time ever as part of a record setting run.
The average price one week ago was $4.911. Gasoline stood at $4.452 a month ago and cost $3.08 one year ago.
Diesel, meanwhile, rose a half-cent overnight, costing $5.775 a gallon early Tuesday.
Oil prices rose about $1 in volatile trade on Tuesday as tight global supplies outweighed worries that fuel demand would be hit by a possible recession and fresh COVID-19 curbs in China.
U.S. West Texas Intermediate (WTI) crude rose 96 cents, or 0.8% to $121.89 a barrel at 0634 GMT, while Brent crude futures rose $1.05, or 0.9%, to $123.32 a barrel.
Tight global supplies have been aggravated by a drop in exports from Libya amid a political crisis that has hit output and ports, while other producers in OPEC+ struggle to meet their production quotas and Russia faces bans on its oil over the war in Ukraine.
The market will be awaiting weekly U.S. inventory data from the American Petroleum Institute on Tuesday and the U.S. Energy Information Administration on Wednesday for a view of how tight crude and fuel supply remain.
Six analysts polled by Reuters expect U.S. crude inventories fell by 1.2 million barrels in the week to June 3, while forecasting that gasoline stockpiles rose by about 800,000 barrels and distillate inventories, which include diesel and heating oil, were unchanged.
Looking ahead, oil prices may face pressure if the U.S. Federal Reserve surprises the markets with a higher-than-expected interest rate hike, CMC Markets analyst Tina Teng said.
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U.S. stocks were higher early Tuesday after a stock market selloff deepened Monday, with the S&P 500 entering a bear market and investors re-examining Friday’s red-hot inflation data and liking it even less.
Faced with rising chances of aggressive monetary tightening by the Federal Reserve, investors broadly unloaded risk. The S&P 500 slumped 3.9% as 495 of its 500 components ended the day lower. The declines left the U.S. stock benchmark down more than 20% from its January record, sending it into a bear market for the first time since 2020.
The energy segment, the only one of the S&P 500's 11 sectors in positive territory this year, fell 5.1%, a steeper decline than that of the broad index. The utilities group, the second-best performer in 2022, also lagged behind the market with a daily drop of 4.6%.
"We're definitely seeing a risk-off atmosphere, a flight to quality," said Charlie Ripley, senior investment strategist at Allianz Investment Management. "In that environment, people need to raise cash."
The S&P 500 fell 151.23 points, or 3.9%, to 3749.63. The Dow Jones Industrial Average dropped 876.05 points, or 2.8%, to 30516.74, while the tech-heavy Nasdaq Composite declined 530.80 points, or 4.7%, to 10809.23, off 33% from its November record.
Markets have swung wildly this year as investors scramble to decipher how rapidly the central bank will raise interest rates in an attempt to tame sky-high inflation. Rock-bottom rates and other stimulative policies helped keep the economy -- as well as markets -- afloat as the arrival of the COVID-19 pandemic idled businesses and threw people out of work. Now, the Fed is trying to tame surging prices by unwinding that easy-money policy.
The Fed will begin its latest two-day policy meeting Tuesday, and most investors believe that the central bank will announce Wednesday it is raising its benchmark interest rate by half a percentage point. But expectations that the Fed will be forced to move even more aggressively this year have risen since Friday's inflation data, which showed U.S. consumer prices rose 8.6% year over year in May, the fastest such increase since 1981.
The report jolted markets and intensified fears that the campaign of monetary tightening could tip the economy into a recession. Asian shares fell across the board Tuesday after Wall Street tumbled into a bear market, indicating that major U.S. benchmarks and individual stocks have fallen 20% or more from a recent high for a sustained period of time.
Benchmarks fell in Japan, Australia, South Korea and China. The Japanese yen's continuing slide against the dollar paused. Japan's Nikkei 225 shed 1.8% to 26,496.91. Australia's S&P/ASX 200 dipped 4.3% to 6,634.00 after reopening from a holiday on Monday. South Korea's Kospi lost 1.0% to 2,479.83. Hong Kong's Hang Seng slipped 0.4% to 20,990.98, while the Shanghai Composite edged down 1.2% to 3,217.72.
Adding to worries about the fragile Japanese economy is the sliding yen, recently at 135, the lowest level against the U.S. dollar since 1998.
The U.S. dollar rose to 134.62 Japanese yen from 134.46 yen, as the yen's weakness was mitigated somewhat by Bank of Japan Gov. Haruhiko Kuroda's comments expressing concern about its decline.
The euro cost $1.0426, up from $1.0409.
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