5 things to know before the stock market opens on Wednesday – CNBC | Jewelry Dukan

Traders on the NYSE floor, September 13, 2022.

Source: New York SE

Here is the key news investors need to start their trading day:

1. Picking up the parts

US stock futures faced a mixed session on Wednesday morning as investors tried to shake off the worst market crisis since June 2020. All three major indices had a miserable Tuesday after the CPI arrived hotter than expected. While the Dow fell a staggering 1,276 points, the S&P 500 and the tech-heavy Nasdaq suffered bigger percentage falls as Wall Street made it clear that the Fed will not back down from its aggressive rate-hike plans anytime soon. In fact, traders are now divided on whether the Fed will hike interest rates by three-quarters of a point or a full point at next week’s meeting. Investors also have more inflation data to chew on. The PPI slipped slightly in August, in line with expectations.

2. Trouble on the railroads

Shipping containers stand at the BNSF Railway intermodal facility in Cicero, Illinois on July 28, 2021.

Scott Olson | Getty Images

Thousands of rail workers could go on strike on Friday as negotiations between some major unions and rail companies over sick leave rules stalled. The union’s chief negotiator accused Union Pacific and Berkshire Hathaway-owned BNSF of delaying things over doctor appointments. BNSF called this untrue, while Union Pacific took a slightly softer tone. “We are in active discussions with unions to try to address these concerns,” the company told CNBC. The White House, meanwhile, has begun preparing for a walkout. A strike could end up costing $2 billion a day. “Strikes are the last resort. They’re not helping anyone because employees are losing money and companies are losing money,” Dennis Pierce, president of the Brotherhood of Locomotive Engineers and Trainmen, told CNBC. “We are not here to hurt the economy.”

3. Starbucks’ new plan

Starbucks CEO Howard Schultz, left, with new CEO Laxman Narasimhan, September 7, 2022.

Source: CNBC

Howard Schultz is back on the road as Starbucks CEO, but his vision for the company he’s built into a global coffee juggernaut still reigns supreme. At its investor day on Tuesday, Starbucks unveiled its new long-term plans, which include everything from strengthening its loyalty programs, expanding stores and increasing automation in its cafes — while the company battles growing union pressure among its baristas. Starbucks also improved its long-term financial outlook. Schultz will stay on as interim CEO until April, when veteran consumer goods manager Laxman Narasimhan is set to take over the role. Narasimhan will officially join the company this fall and familiarize himself with Schultz.

4. What next for Ukraine?

A long convoy of invading Russian military vehicles is shown on the road to Kyiv at the start of the war in late February, just before vehicle breakdowns, lack of basic supplies and attacks by Ukrainian defenders forced it to turn around and flee back to Russia. Last week, Ukrainian troops inflicted a defeat on Russia in Kharkiv that was just as dramatic as before Kyiv.

Maxar | Getty Images

After Ukraine’s military retook thousands of kilometers of Russian-held territory, President Volodymyr Zelenskyy said his government is working to stabilize several regions and root out lingering Russian saboteurs and agents. It also raises the question of whether Ukraine’s shocking and successful counteroffensive against Russian President Vladimir Putin’s forces marks a turning point in the war. US President Joe Biden said it may be too early to tell and he thinks “it’s going to be a long way”. Elsewhere, during a 90-minute phone call, Chancellor Olaf Scholz urged Putin to end the war. Read live updates here.

5. Mortgage demand falls

A for sale sign is posted in front of a home listed for over $1 million on April 29, 2022 in San Francisco, California.

Justin Sullivan | Getty Images

The housing market is still under pressure from rising interest rates. According to the Mortgage Bankers Association, overall mortgage demand fell by over 1% week-on-week. Since last year, however, the decline has been more significant. Demand for homebuyer mortgages fell by almost a third. Demand for refinancing has also fallen by more than 80%. Rates were practically at their lowest point this time last year, but they’re now above 6%, about double what they were at the start of 2022. And after Tuesday’s surprisingly hot inflationary pressures, the Fed will likely only be more emboldened to continue to raise interest rates on an aggressive clip.

– CNBC’s Samantha Subin, Lori Ann LaRocco, Emma Kinery, Holly Ellyatt and Diana Olick contributed to this report.

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