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Stock futures slide after Fed Chair says more rate hikes likely, Treasuries fall, Latest moves in key stocks, Zoom to lay off 1300 employees, UN says North Korea stole record-breaking virtual assets, and more financial news.
All major stock futures were down in early trading on Wednesday. Dow Jones industrial average futures were down 138 points or 40%, while S&P 500 futures dipped 18.5 points or -0.44%, and NASDAQ futures fell 41.75 points or -0.33%, Yahoo reported.
In oil futures, WTI crude was up +1.08% at $78.03 a barrel, while Brent crude was up +0.72% and trading at $84.29 a barrel as of 8:47 AM ET.
Federal Reserve Chair Jerome Powell’s anticipated speech on Tuesday projected that additional interest rate hikes will be necessary to reel inflation into a target range of 2 percent, Yahoo Finance reported.
“The disinflationary process has begun,” Powell said. “It has begun in the goods sector, which is about 25% of the economy.”
US Treasuries fell on Wednesdays as investors assessed the latest comments from Federal Reserve Chairman Jerome Powell that indicated more interest rate hikes were likely.
The benchmark US 10-Year Treasury was down -0.016 to yield 3.66%, while the 2-Year Treasury fell -0.015 to yield 4.456% as of 8:46 AM EST.
Fast-food giant Yum Brands topped expectations with its quarterly earnings and revenue, led by the strength in its Taco Bell brand that outperformed analysts’ expectations. However, weak sales in China hurt its Pizza Hut and KFC brands. In the US, Pizza Hut’s same-store sales rose 4%. On Wednesday, YUM was down -0.34 points or -0.26%.
Bed Bath & Beyond stock sank 48% on Tuesday following an announcement that the retailer plans an equity offering to raise as much as $1.025 billion to stave off a bankruptcy filing for now. In a regulatory filing, the company also said it plans to close another 150 stores, NBC reported.
Maersk, a global barometer for trade, posted a record $36.84 for its 2022 earnings but warned of a tough 2023 as its 4th quarter earnings fell below a consensus analyst forecast of $6.77 billion, significantly down from $8 billion in the 4th quarter of 2021. The company projected the global ocean container market will increase between -2.5% to +0.5% in 2023.
Zoom announced it is laying off 1300 employees, or approximately 15% of its staff, while its CEO will take a massive pay cut after the pandemic-fueled surge that led to a demand for its digital services has waned as more remote workers go back to the office, CNN reported.
“As the CEO and founder of Zoom, I am accountable for these mistakes and the actions we take today– and I want to show accountability not just in words but in my own actions,” CEO Eric Yuan wrote in a memo. “To that end, I am reducing my salary for the coming fiscal year by 98% and foregoing my FY23 corporate bonus.”
Hackers working for the North Korean government stole a record-breaking number of virtual assets last year estimated to hold a value between $630 million and more than $1 billion, according to a new United Nations report. The UN experts said hackers used increasingly sophisticated techniques in gaining access to digital networks related to cyber finance, as well as stole information useful to North Korea’s nuclear and ballistic missile programs from governments, individuals, and companies, Yahoo reported.
