Here are the most important news, trends and analysis investors need to start their trading day:
1. Dow set to jump after breaking four-day losing streak
Traders work on the floor of the New York Stock Exchange (NYSE), September 21, 2021.
Brendan McDermid | Reuters
Dow futures rose 200 points on Thursday, a day after the 30-stock average and the broad S&P 500 broke four-session losing streaks. The Nasdaq rose for the second day in a row. All three stock indexes rose 1% as investors moved past problems with Chinese real estate giant China Evergrande Group and took comfort in signaling to the Federal Reserve that it had no immediate plans to remove the policies of American monetary stimulus. Wednesday’s gains put the brakes on Monday’s drop and September’s decline, which has historically been a tough month on Wall Street. The Dow Jones was down almost 4% from last month’s record close. The S&P 500 and Nasdaq were down about 3% from their last closing highs earlier this month.
2. China braces for possible demise of Evergrande, WSJ says
China Evergrande Group’s real estate and tourism development apartment buildings in Venice in Qidong, Jiangsu Province, China on Tuesday, September 21, 2021.
Qilai Shen | Bloomberg | Getty Images
Chinese officials have asked local authorities to prepare for a potential collapse in heavily indebted Evergrande, the Wall Street Journal reported Thursday. Local officials described the signals from Chinese authorities as “preparing for a possible storm” and said the government told them they should only intervene at the last minute to avoid fallout from Evergrande’s disappearance. , according to the Journal. The big developer made a payment on a local bond on Wednesday. However, it is not known whether the company will pay the interest due Thursday on its offshore bonds.
3. Weekly jobless claims are down
A job fair in Louisville, Kentucky on June 23, 2021.
Luke Sharrett / Bloomberg via Getty Images
The US government’s weekly look at initial jobless claims is expected to show a drop close to the lows of the Covid pandemic. The first claims for unemployment benefits for the week ended September 18 amounted to 320,000, against 332,000 the previous week. After its two-day meeting in September, the Fed provided its quarterly economic projections on Wednesday. Officials predict the country’s unemployment rate to fall to 4.8% this year from 5.2% currently. The June estimate called for an end-of-year rate of 4.5%.
4. The Fed cut its economic growth forecast and raised its inflation outlook
The Marriner S. Eccles Federal Reserve Building is located in Washington, DC, United States on Tuesday, August 18, 2020.
Erin Scott | Bloomberg via Getty Images
The Fed’s forecast also slashed US growth figures, raised inflation expectations and pushed back the timing of an interest rate hike. The Federal Open Market Committee now sees gross domestic product increasing by just 5.9% this year. Core inflation is expected to rise 3.7% this year. Against this backdrop, the Fed left interest rates close to zero unchanged on Wednesday afternoon. But most members are now seeing the first rate hike in 2022. The Fed has given no timetable to cut its bond purchases. However, Fed Chairman Jerome Powell said in his post-meeting press conference that if the recovery stays on track, “a phase-down process that ends around the middle of next year will be probably appropriate “.
5. CDC to vote on Pfizer Covid boosters for older and vulnerable Americans
A nurse takes a vial of Pfizer-BioNTech Covid-19 vaccine at an pop-up vaccination clinic in the Arleta neighborhood of Los Angeles, California on August 23, 2021.
Robyn Beck | TBEN | Getty Images
The CDC could vote Thursday on the FDA’s decision to authorize a Pfizer Covid recall for people 65 and older as well as other vulnerable Americans six months after completing their first two doses. If the CDC approves, booster injections for these groups could begin immediately. But that wouldn’t go as far as pressure from the Biden administration to offer boosters to the general public as early as this week.
– TBEN jesse book contributed to this report. Follow all the market action like a pro on TBEN Pro. Get the latest pandemic news with TBEN’s coronavirus coverage.