Stock futures gained Wednesday morning to shake off some losses after a couple of volatile session on Wall Street. Investors looked to the Federal Reserve’s latest statement and press conference to remove some uncertainty on the outlook for monetary policy.
Contracts on the S&P 500 gained more than 1% in early trading. The index closed lower for a fifth time in six sessions on Tuesday, extending volatility after Monday’s rollercoaster trading day. Contracts on the Nasdaq gained about 2% in early trading.
Microsoft (MSFT) shares reversed overnight losses and rose Wednesday morning after the company delivered better-than-expected fiscal second-quarter revenue and earnings. Shares of chipmaker Texas Instruments (TXN) also gained after offering a better-than-expected outlook for current-quarter sales despite concerns over ongoing semiconductor shortages. Companies including Tesla (TSLA) and Intel (INTC) are poised to report results on Wednesday.
For markets, the Federal Reserve’s latest monetary policy statement and press conference from Fed Chair Jerome Powell later in the day will be the banner event. Investors have been pricing in a more aggressively hawkish central bank as the Fed works to rein in inflation currently running at a four-decade high. Over the past couple months, the Fed has signaled through its December meeting minutes and in public remarks that it will likely begin raising interest rates from current near-zero levels in March. It is also considering beginning to roll assets off its balance sheet after amassing some $9 trillion in its bond portfolio.
“If you think about what’s happened in the markets, it indicates the degree of sensitivity market participants have to what is going to be the new rate environment and the new liquidity environment,” David Bailin, Citi chief investment officer and head of Citi global wealth management, told Yahoo Finance Live on Tuesday.
“The Fed made a major reversal about five weeks ago when it said that it was both going to raise rates and also consider quantitative tightening, which effectively…