Investing.com - Here are the top five things you need to know in financial markets on Wednesday, August 28:
1. Pound slides on reports of extended recess for U.K. Parliament
The move was hailed as a tactic to curtail parliamentary procedures that could lead to legislative changes that would prevent the U.K. from leaving the European Union on Oct. 31 without a deal, known as a “hard Brexit”.
2. 30-year Treasury yield hits record low
The 30-year yield fell below that of 3-month paper a day earlier for the first time since 2007, meaning that investors were willing to loan the U.S. government money at a lower rate for the longer-term bond.
The 2-year rate has passed that of the 10-year ahead of every recession over the past 50 years. On average, yield curve inversion comes 22 months ahead of the impending recession, according to Credit Suisse.
3. U.S. futures steady despite yield curve inversion
Traders appeared to have taken a pause from concerns over the yield curve inversion, while Sino-U.S. trade tensions were put on the back burner as markets awaited the next round of tariffs.
Washington will apply the first stage of U.S. tariffs on $300 billion worth of Chinese goods on Sunday, just ahead of the Labor Day holiday while Beijing will enact its retaliatory tariffs on the same day.
On the earnings front, Tiffany (NYSE:TIF) and Brown-Forman (NYSE:BFb) were among companies set to report ahead of the open, while Box (NYSE:BOX) and Five Below (NASDAQ:FIVE) will be on tap after the close.
Mixed readings came from reports released after Tuesday’s close. Shares in Autodesk (NASDAQ:ADSK) tumbled 11% in premarket trade after issuing a cautious forecast, while Hewlett Packard Enterprise (NYSE:HPE) jumped nearly 6% as it raised its full-year guidance.
Read more: 3 Stocks Set To Outperform As The U.S.-China Trade War Escalates - Jesse Cohen
4. Fedspeak in focus for clues on easing
As uncertainty over whether the U.S. and China will resume trade talks dominates market direction and supports the Federal Reserve’s dovish monetary policy stance, investors will have the opportunity to hear from policymakers for further signs the U.S. central bank will cut its benchmark rate next month.
Expectations for an aggressive Fed rate cut at the central bank’s next meeting were dented by better-than-expected consumer confidence data on Tuesday, suggesting the U.S. economy remains on solid footing.
5. Oil gains on inventory draw, EIA data on tap
Official government data from the Energy Information Administration will be released at 10:30 AM ET (14:30 GMT) with U.S. crude inventories forecast to fall by just 2.1 million barrels. If the EIA confirms API’s reading, that would be the largest decline in nine weeks.
-- Reuters contributed to this report.
Add a Comment
Are you sure you want to block %USER_NAME%?
By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.
%USER_NAME% was successfully added to your Block List
Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.