Here are the top five things to know about in financial markets on Wednesday, July 24th.
1. Stocks set to open lower on DoJ tech action
U.S. stock indexes are set to open lower as the Department of Justice’s announcement that it will conduct a broad review into the workings of some of the largest tech companies weighs on some of the market’s biggest blue-chips.
Amazon (NASDAQ:), Facebook (NASDAQ:) and Google (NASDAQ:) all fell over 1% in after-hours trading on Tuesday on the news, which came only days after the federal government flexed its muscles by fining Facebook $5 billion for privacy breaches.
were down 58 points, or 0.2% by 5:30 AM ET (0930 GMT), while were down 9.6 points, or 0.3%, and the contract was down 50 points, or 0.7%
The weak business surveys reported elsewhere are also overshadowing Tuesday’s late news that the U.S. and China are to resume high-level talks on trade for the first time since the G20 summit.
2. Earnings, earnings, earnings
Peak earnings season continues, against a backdrop of results to date that have shown a broad weakening trend, masked by frequent outperformance of downwardly-massaged expectations.
AT&T (NYSE:) and Boeing (NYSE:) before the bell, and Facebook (NASDAQ:) and Tesla (NASDAQ:) after the close, bookend a heavy day of releases. Caterpillar (NYSE:), Anthem (NYSE:) and NextEra Energy (NYSE:) also all report early, while PayPal (NASDAQ:) and Citrix (NASDAQ:) round off the day’s action.
In Europe, Deutsche Bank (NYSE:) already reported a bigger-than-expected loss for the quarter after its slash-and-burn restructuring announced two weeks ago.
3. Global PMIs push bond yields to new lows
The global slowdown in manufacturing goes on and on.
Flash readings for IHS Markit’s purchasing manager indexes for , and the all fell in July, while ’s manufacturing sector contracted at the fastest rate since 2009. That news raises the pressure on the European Central Bank to take action at its governing council meeting on Thursday.
Bond yields fell again, with the dropping to -0.38%, only three basis points short of its all-time low. The , however, edged down only slightly to 2.06%. The U.S. is due at 9:45 AM ET (1345 GMT), a day after the Richmond manufacturing survey gave its lowest reading for activity in six years.
4. Johnson to start ramping up No-Deal Brexit preparations
Boris Johnson is set to be confirmed as the U.K.’s Prime Minister by Queen Elizabeth, allowing him to start announcing appointments to his cabinet.
Analysts expect the pressure on and U.K. assets to increase in the short term, as he aims to implement his key policy aim of getting Britain out of the European Union by Oct. 31, even though that leaves little or no time for a new transitional deal to be hammered out.
Unconfirmed reports suggest that Johnson will give a senior advisory role to Dominic Cummings, the man who orchestrated the Leave campaign in the 2016 referendum.
5. Mueller to Testify Before Congress
Special Counsel Robert Mueller is due to testify before a House of Representatives committee later Wednesday. He’s said he won’t go beyond what’s in his already-released report into alleged collusion between Russia and the Trump campaign in the 2016 election.
Mueller’s testimony comes a day after Trump sued to stop the House Ways and Means Committee subpoenaing his state tax returns.