Here is what you need to know.
Wednesday’s a Fed day. The Federal Reserve will announce its latest policy decision at 2 p.m. ET. The Fed’s statement will be accompanied by its latest “dot plot” and an updated summary of Fed staffer’s latest economic projections. Fed fund futures are pricing in just a 4% chance of a rate hike at Wednesday’s meeting, but traders will be parsing the words of Chair Janet Yellen closely as she could potentially lay the groundwork for rate hikes later this year. Yellen’s press conference will take place at 2:30 p.m. ET.
We’re closer to Donald Trump versus Hillary Clinton. Republican front-runner Donald Trump won primaries in Florida, Illinois and North Carolina while Gov. John Kasich took his home state of Ohio to keep his campaign on life support. Missouri has not yet been declared as Donald Trump holds a small lead over Sen. Ted Cruz with two precincts still needing to tally their votes. Sen. Marco Rubio bowed out of the race after losing his home state of Florida. On the Democratic side, former Secretary of State Hillary Clinton swept all five states to extend her lead over Sen. Bernie Sanders.
Oil producers are meeting in April to discuss a production freeze. Both OPEC and non-OPEC nations are meeting April 17 in Doha, Qatar to discuss freezing their oil production. Reuters reports, a statement released by Qatari oil minister Mohammed Bin Saleh Al-Sada said oil ministers from 15 OPEC and non-OPEC countries, who control 73% of global production, will take part in the talks. Crude oil is up 2.1% at $37.09 per barrel.
The number of people in the UK claiming jobless benefits hit a record low. The number of people claiming jobless benefits in the UK fell by 18,000 in January to 716,000, the lowest reading in more than 40 years of data, according to the Office for National Statistics. The drop was nearly twice as big as the 9,100 person decline that was expected. Additionally, average earnings rose 2.2% year-over-year, edging out the 2.1% gain that economists were forecasting. The British pound is weaker by 0.3% at 1.4114.
Deutsche Boerse and the London Stock Exchange are merging. The two sides “have reached agreement on the terms of a recommended all-share merger of equals.” Under the terms of the agreement, LSE shareholders will receive 45.6% of the newly formed entity while the rest goes to Deutsche Boerse shareholders. Once the merger is completed, the combined company will have a market cap of at least £20 billion, making this one of the biggest European markets deals in decades. LSE CEO Xavier Rolet, who will step down once the merger is completed, said in a statement, “We are creating an industry-defining combination which will be a leading global market infrastructure business, very well positioned to create new benefits and efficiencies for our customers and increase value for our shareholders.”
Chipotle warned it’s going to have a huge Q1 loss. A regulatory filing released on Tuesday showed the burrito chain expects a loss of $1 per share “or worse” in the first quarter as it continues to deal with the fallout from its norovirus and E. coli outbreaks. A loss that size would be far worse than the $0.03 loss that was expected by the Bloomberg consensus. Chipotle blames its terrible forecast on “higher expenses driven by increased marketing and promotions spend in other operating costs.” While same-store sales tumbled 26.1% in February, it was an improvement 36.4% drop witnessed in January. Shares of Chipotle fell 5% in after-hours trade following the release.
Oracle is buying back more stock. The company announced earnings of $0.64 per share, topping the Bloomberg consensus of $0.62. Revenue fell 3.4% to $9.0 billion, which was a bit shy of the $9.13 billion that was anticipated. Oracle’s total cloud revenues were $583 million, up 57% in US dollars and up 61% in constant currency, according to the release. The company said it would buyback an additional $10 billion worth of stock. Oracle shares were higher by 4% in after-hours trade.
Stock markets around the world are mixed. A mixed session in Asia saw China’s Shanghai Composite (+0.2%) lead and Japan’s Nikkei (-0.8%) lag. In Europe, Germany’s DAX (+0.5%) is out in front. S&P 500 futures are unchanged at 2006.50.
Earnings reporting is light. FedEx, Jabil Circuit and Williams-Sonoma are among the names reporting after markets close.
US economic data remains heavy. CPI, housing starts and building permits will all be released at 8:30 a.m. ET before industrial production and capacity utilization cross the wires at 9:15 a.m. ET. Crude oil inventories will be announced at 10:30 a.m. ET. The US 1o-year yield is lower by 2 basis points at 1.95%.
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