BY THE NUMBERS
Dow futures dropped about 300 points, or 1%, on Wednesday as October has so far lived up to its reputation for extreme volatility. S&P 500 and Nasdaq futures fell more than 1.2% and nearly 1.5%, respectively, in premarket trading. On Tuesday, the Dow Jones Industrial Average, S&P 500 and Nasdaq all soared roughly 1% in a rebound from the prior session's slide. On Friday, Wall Street started the new month, after a rough September, with a strong rally. (CNBC)
Many market strategists pointed out that even though October can be tricky, the fourth quarter has historically been a mostly strong period for stocks. The Nasdaq was 6% away from its Sept. 7 record close. The S&P 500 was 4.2% from from its Sept. 2 record close. The Dow was 3.7% away from its Aug. 16.
Rising bond yields on Wednesday were pressuring tech stocks, with Apple, Microsoft and Amazon all falling around 1% each in the premarket. The 10-year Treasury yield topped 1.5% after the first of three key jobs reports this week. (CNBC)
Before the opening bell Wednesday, ADP reported the private sector created 568,000 new jobs in September. U.S. companies shook off worries over the Covid delta variant and hired at a faster-than-expected pace last month. The Labor Department issues weekly jobless claims Thursday morning, one day before the big September employment report.
* As mortgage rates shoot even higher, refinance demand plummets 10% (CNBC)
U.S. oil prices on Wednesday pulled back modestly from near seven-year highs, on track to break a four-session winning streak. West Texas Intermediate crude, however, gained 1.7% on Tuesday, settling at $78.93 per barrel after hitting a session high of almost $80. WTI has gained nearly 65% in 2021, adding price pressures in the U.S. at a time when the Fed is trying to gauge the staying power of higher inflation. (Reuters)
IN THE NEWS TODAY
President Joe Biden has conceded the final version of a $3.5 trillion package of social and environmental initiatives with only Democratic support will have to be considerably smaller. In virtual meetings with House Democrats this week, Biden said he reluctantly sees a price tag between $1.9 trillion and $2.3 trillion, a Democrat familiar with the sessions said Tuesday. (AP)
Sen. Joe Manchin, a high-profile Democratic holdout, wants a bill closer to $1.5 trillion. For passage, Democrats need every vote in the 50-50 Senate and all but three in the House.
Biden said Democrats are considering a change to the Senate's filibuster rules in order to quickly pass a debt ceiling increase needed avoid a devastating credit default. The deadline set by the Treasury Department is Oct. 18. Getting rid of the filibuster would lower the typical 60-vote threshold for passage to 50. (AP)
With Vice President Kamala Harris breaking any tie, a simple majority would be enough for passage. Republicans want Democrats to utilize the reconciliation process they aim to use for the budget bill, to act on the debt ceiling.
* Troubled student loan forgiveness program gets an overhaul (AP)
Alphabet's (GOOGL) Google launched on Wednesday a suite of changes to many of its core products to help consumers make sustainable choices more easily. The changes include suggested map routes that use less gas, flight information with carbon emission data displayed, and more climate-focused search results. (CNBC)
* Microsoft’s big new Windows 11 update is out: Here’s how to get it (CNBC)
Facebook (FB) CEO Mark Zuckerberg on Tuesday finally addressed the series of criticisms made by whistleblower Frances Haugen. He denied that the social media company prioritizes its profits over the safety of its users. "At the heart of these accusations is this idea that we prioritize profit over safety and well-being," Zuckerberg said in a post on his Facebook profile. "That's just not true." (CNBC)
* CEO says Amazon could do more to treat workers better (CNBC)
Home Depot (HD) has hired Walmart (WMT) to deliver paint, tools and other online purchases to its customers' doors. Home Depot is the first customer for Walmart's new delivery business, GoLocal. The same-day and next-day delivery service will be limited to home improvement purchases that can easily fit into a car, such as fasteners, boxes of nails or paint brushes. (CNBC)
* Burger King to test Impossible Foods' meatless nuggets (CNBC)
STOCKS TO WATCH
Constellation Brands (STZ) reported adjusted quarterly earnings of $2.38 per share, missing the $2.77 consensus estimate, although revenue did beat Wall Street forecasts and Constellation increased its full-year earnings outlook. Shares fell 2.2% in the premarket.
Acuity Brands (AYI), a maker of lighting and building management systems, reported an adjusted quarterly profit of $3.27 per share, beating the consensus estimate of $2.85, with revenue topping forecasts as well. The earnings beat came amid what the company terms a "challenging" environment that included higher labor, materials and freight costs.
Palantir Technologies (PLTR) surged 8% in the premarket following news that it won an $823 million Army contract to provide its Gotham platform, an operating system designed to optimize defense decision-making.
Norwegian Cruise Line (NCLH)CEO Frank Del Rio told CNBC's Closing Bell that the company would have its full fleet in operation by April for the first time since the pandemic began. He said 75% of ships should be sailing by the end of this year. Norwegian shares fell 1.7% in premarket trading.
Seagate Technology (STX) slid 3.3% in the premarket after Morgan Stanley downgraded the stock to "equal weight" from "overweight," citing deteriorating industry data including rising inventory levels and a drop in corporate spending plans.
General Motors (GM) shares will be on CNBC's watch list today as GM holds its investor day, set to highlight its plans for electric vehicle growth.
Southwest Gas (SWX) struck a deal to buy Questar Pipelines from Dominion Energy (D) for $1.975 billion in cash and assumed debt. Investor Carl Icahn, who holds a 4.9% stake in Southwest Gas, had sent a letter to the company objecting to such a deal when reports of it first surfaced earlier this week.
Manchester United (MANU) announced a 9.5 million share offering by the Glazer family, which controls the soccer club. Manchester United will not receive any proceeds from the sale. The stock tumbled 9.4% in premarket action.