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Caution before the start of the American Session
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Loading...U.S. stock index futures ticked lower Monday morning as Wall Street tempered its expectations for this week’s trade negotiations between the Washington and Beijing and prepared for the latest monetary policy decision from the Federal Reserve.
The Fed will announce its latest decision on whether to adjust interest rates at 2 p.m. ET Wednesday; Chairman Jerome Powell will also address the state of the economy in a press conference at 2:30 p.m. ET.
Despite a healthy economy and an unemployment rate under 4%, investors widely expect the central bank to cut its benchmark lending rate for the first time since 2008 by 25 basis points. The Fed, which seeks to keep inflation around 2%, has had trouble sustaining price growth in recent months despite a healthy economy and low unemployment.
Investors are also likely to closely monitor whether the central bank will signal more cuts over the coming months. Economists mostly anticipate anywhere from one to three rate cuts this year.
U.S. and Chinese officials will convene in Shanghai this week in a latest attempt by the globe’s two largest economies to craft a trade deal and end their year-long trade dispute. While investors last week heralded news of the face-to-face discussion with optimism, people close to the talks warned that the appetite for a sweeping deal have waned since the spring.
Those familiar with the talks told the Wall Street Journal that major breakthroughs are unlikely on issues that led to a breakdown in talks in early May but that more modest goals could be within reach. American and Chinese officials have struggled to reach a compromise over the protection of intellectual property and Beijing’s subsidization of businesses.
In corporate news, drugmaker Pfizer plans to divest its off-patent drug business and marry it with generic-drug maker Mylan. The combined company, which will market Mylan’s EpiPen and Pfizer’s Viagra, will be domiciled in the U.S.
Source: CNBC
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