- The S&P 500 snapped a six-day streak of finishing at all-time closing highs.
- The U.S. Federal Reserve is slated to provide its latest interest rate decision.
- Starbucks beat analysts’ consensus forecast for the third fiscal quarter, sending shares rallying.
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While it lasted, it was enjoyable. On Tuesday, the S&P 500 ended a six-day run of closing at all-time highs. Among the names taking a hit were stocks that were subjected to the meme treatment last week.GoPro and Krispy Kreme both sank more than 8%, while Opendoor Technologie stumbled more than 12%. Futures for stocks have not changed much.Wednesday morning before a day full of activities.
Fed Day has arrived. At 2:00 p.m., the U.S. Federal Reserve is expected to make its most recent interest rate announcement. But it appears like the writing is on the wall: The CMEFedWatchtool shows that Fed funds futures are pricing in a roughly 98% chance of the central bank remaining unchanged. The focus will shift to Fed Chair Jerome Powell’s news conference, which is anticipated to begin at 2:30 p.m., following the announcement. Powell has, of course, been in the news lately due to pressure from the White House to reduce the overnight policy rate. After all, the public back and forth between Powell and President Donald Trump on the expense of building renovations only occurred last week. In summary, there is a high level of interest in this meeting even though there is little chance of a rate cut.
Expectations may need to be tempered for those anticipating the U.S. would reach a trade agreement with China before Friday’s tariff deadline. U.S. Commerce Secretary Howard Lutnick told CNBC on Tuesday that the Asian nation’s negotiations are moving along on a different schedule from the rest of the world. As noted by Kevin Breuninger of CNBC, Lutnick had previously stated that Friday is a “hard deadline” for tariff payments, but that nations are free to continue negotiating after that date. Thus, in an interview with CNBC, Treasury Secretary Scott Bessent assured businesses that “it’s not the end of the world” if the tariff levels proposed in early April are implemented because they might not be permanent. On recent earnings calls, however, a number of businesses have stated that the charges will cost them hundreds of millions of dollars.
Shares of Starbucks surged in Wednesday’s premarket after the company exceeded analysts’ consensus sales prediction for the third fiscal quarter. The recovery of the coffee business seems to be proceeding more quickly than anticipated, according to CEO Brian Niccol, whose departure from Chipotle, as you may recall, excited investors. Mike Grams stated in an exclusive interview with CNBC’s Kate Rogers this week that Starbucks is attempting to return to its core in an attempt to win back customers. Indeed, there is ground to cover: On Tuesday, the Seattle-based chain revealed that same-store sales have declined for six consecutive quarters.
It’s not so hot for Gucci. According to parent company Kering, the well-known luxury brand’s revenues fell by almost 25% in the second quarter. In contrast, the company’s overall sales were 15% lower than they were a year ago and below analyst expectations. All markets suffered a decline, according to Kering, with Japan and the larger Asia Pacific area leading the way. According to the children, that is “not Gucci.”
Money Report
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This report was contributed to by Brian Evans, Jeff Cox, Erin Doherty, Kevin Breuninger, Amelia Lucas, Kate Rogers, and Karen Gilchrist of CNBC.
Also on CNBC
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5 things to know Tuesday: Another record | Baseline tariffs | Fed meeting ruling
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5 things to know Monday: EU trade deal, all-time high streak, ‘quishing’
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5 things to know Friday: Fed visit, Intel spending cuts, more meme stocks
