5 things to know before the stock market opens on Thursday

Here are the most important news, trends and analysis investors need to start their trading day:

1. Futures are essentially flat after Wednesday’s drop

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, June 3, 2022.

Brendan McDermid | Reuters

US stock futures were essentially flat on Thursday, as the main release of May inflation data, set for Friday, goes deeper into focus. Traders are also watching The European Central Bank’s latest interest rate decision Thursday. Wall Street closed lower than a day earlier. The S&P 500 down 1.08% on Wednesday, while Dow Jones Industrial Average and Nasdaq Composite lost 0.81% and 0.73% respectively. The only sector in the S&P 500 that ended Wednesday was energy, which closed at the highest level in nearly eight years.

All three major US stock indexes broke a two-day winning streak on Wednesday, as investors continued to monitor the bond market and seek fresh information on the trajectory of economic growth. The Dow is now essentially flat for the week and nearly 11% below its record high. The S&P 500 has gained 0.18% for the week and is down 14.6% from its peak in early January. Nasdaq solidly in the green for the week, up 0.61%. However, the tech index remains entrenched in the bear market, 25% below its November all-time high.

2. 10-year profit trading over 3%; oil is basically flat

Return on benchmark 10-year Treasury bond remained above 3% on Thursday morning, after breaking above that psychological level on Wednesday. US government bond prices, which are inversely proportional to yields, have trended lower this week. Yields on 10-year Treasuries ended last week at 2.941% and most recently at the end of May stood around 2.71%. Stock investors have been keeping a close eye on the rise in bond yields in 2022, as higher interest rates typically put pressure on growth-oriented tech stocks with substantial cash flows expected. in the coming years.

Oil prices were essentially flat on Thursday. The price of US West Texas Intermediate crude fell about 0.2% to around $121.90 a barrel. Brent crude, the international benchmark, was trading at $123.48 a barrel, just around where it ended Wednesday as WTI and Brent both settled at two-month highs. The recent rise in oil prices that come as China’s Covid reopening is expected to spur more demand while supply concerns elsewhere persist.

3. Tesla Stock Soars After UBS Upgrade

A Tesla store is seen in Shanghai, China, February 1, 2022.

Costfoto | Publishing Future | beautiful pictures

Shares of Tesla up 3.5% in pre-market trading on Thursday, as UBS upgraded electric vehicle maker to buy. Shares of Tesla have struggled this year, down more than 30% year-over-year through Wednesday. Despite that steep drop, UBS wrote to clients that it’s time to “go bold” with the stock, adding that the company’s future remains bright. The money market gains for Tesla came after shares rose 1.25% on Wednesday in a day of losses for the S&P 500. Tesla has the sixth-largest weighting in the S&P 500.

4. Quarterly dividend increase target

A person walks into a Target store in Washington, DC, on May 18, 2022.

Stefani Reynolds | AFP | beautiful pictures

Target said on Thursday that its board has approved the dividend increase. The quarterly payout will increase 20% to $1.08 per common share, up from the previous level of 90 cents. The Minneapolis-based retailer is a member of S&P 500 dividend aristocracy index, which includes companies that have increased their dividends every year for the past 25 years; Target says 2022 will be the 51st consecutive year it has done so. Thursday’s announcement from Target comes two days after the company warns its fiscal second-quarter profits will be squeezed as it has taken aggressive steps to eliminate excess inventory. Target stock, down more than 30% year-over-year, was up 0.76% in pre-market trading.

5. Apple subsidiary will extend loans for Postpaid service

Apple’s website is shown on a laptop screen and the Apple logo is shown on a phone in this illustration photo.

Jakub Porzycki | Nurphoto | beautiful pictures

Apple intends to use a wholly owned subsidiary to check credit and extend short-term installment loans to those using its new buy now, pay later service. The iPhone maker announced the new product on Monday as it kicked off its developer conference; it will be called Apple Pay Later and will be available later this year, when the iPhone’s new iOS 16 software rolls out.

The additional details about Apple Pay Later reflect the tech giant’s ambitions in the fintech industry. While Goldman Sachs participates as a technical provider for loans made through Apple Pay Later, it is notable that Apple effectively keeps credit decisions and uses its balance sheet to issue loans. Buy now, pay later is increasingly popular in recent years. Startups like Affirm have made waves big enough to set up fintech companies like Square parent Unit make transactions to buy existing players, while PayPal launched its own offer.

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