Dow sheds 300 points as traders await big tech earnings

JOHANNES EISELE/AFP via Getty ImagesTraders work during the opening bell at the New York Stock Exchange (NYSE) on February 28, 2020 at Wall Street in New York City.

US stocks fell Wednesday morning, with the Dow shedding 306 points and the S&P 500 slipping 1.14% as investors wait for a huge day of earnings.

Apple, Facebook, and Tesla are all due to release their latest figures after the Wednesday market close.

Microsoft’s shares were higher in pre-market trading after it posted a 17% rise in sales in the latest quarter.

The Federal Reserve is expected to keep monetary policy on hold when the FOMC releases a policy statement at 2:00 p.m. ET Wednesday. Investors will focus on the press conference by Chairman Powell that will follow.

“With no change to policy, the line of questioning will likely centre around the future withdrawn of accommodation, including the future tapering of asset purchases and rate liftoff. Powell will be light on specifics because while the outlook is titled to the upside, the uncertainty surrounding fiscal stimulus makes it impossible to lay out concrete guidance,” a team of Jefferies economists said.

Here’s where US indexes stood shortly after the 9:30 a.m. ET open on Wednesday:

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Outside of the tech space, a slew of other major companies reported earnings Wednesday. Private-equity firm Blackstone reported earnings per share of $US1.13, compared to the consensus estimate of 89 cents per share. Starbucks beat estimates, while Boeing reported a loss of $US15.25 per share, while its revenue beat Wall Street expectations.

AMC shares skyrocketed as much as 260% in premarket trading on Wednesday as day traders piled into heavily shorted stocks for a third consecutive day. Frenzied buying also drove GameStop,which has already surged adding 685% in 2021. The Reddit-loved stock spiked after Elon Musk tweeted “Gamestonk!!” in after-hours trading Tuesday. BlackBerry and Bed Bath & Beyond also gained.

The record rise in these stocks has hit short sellers hard and divided opinions sharply. On Wednesday, “Big Short” investor Michael Burry, who took a bullish view of GameStop in 2019, tweeted the price moves are “unnatural” and “insane”.

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Bitcoin was down 3.34% to $US30,649.4324. The cryptocurrency has wavered in a narrow trading range over the past week after surging to record highs earlier in the month.

Spot gold fell 0.55% lower, to $US1,840.70 per ounce. The US dollar gained slightly against Group-of-20 currency peers and Treasury yields dipped lower.

Oil prices slipped. West Texas Intermediate crude fell as much as 0.32%, to $US52.44 per barrel. Brent crude, oil’s international benchmark, lost 0.27%, to $US55.76 per barrel.

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