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Sep 20, 2016

U.S. Stock Market Future Indications, by MarketWatch: U.S. Stocks Set For Bounce Ahead of Fed, BoJ Meetings

marketwatch.com
 
Sara Sjolin
 
Wall Street was set for a higher open on Tuesday, but with stock futures trading in tight ranges as investors remained cautious ahead of two major central-bank decisions.

Futures for the Dow Jones Industrial Average YMZ6, +0.31%  rose 57 points, or 0.3%, to 18,108, while those for the S&P 500 index ESZ6, +0.35%  gained 8.10 points, or 0.4%, to 2,141. Futures for the Nasdaq-100 index NQZ6, +0.35%  advanced 17.50 points, or 0.4%, to 4,811.75.
The gains come after a choppy session on Monday, when stocks SPX, +0.00% DJIA, -0.02% closed essentially flat in anticipation of the closely watched Federal Reserve and Bank of Japan monetary-policy decisions on Wednesday.
“It isn’t unusual for traders to adopt a more cautious approach ahead of these events, particularly when we have two on the same day, both of which have the potential to create huge amounts of volatility in the markets,” said Craig Erlam, senior market analyst at Oanda, in a note.
The Fed kicks off its two-day meeting on Tuesday and will release its rate decision at 2 p.m. Eastern Time on Wednesday. Investors are widely expecting the central bank to stand pat on monetary policy, so attention is instead turning to the BOJ, where policy surprises are seen as more likely.
Japanese policy makers have fought hard in recent years to battle low inflation, slow growth and a strong yen, lowering rates into negative and launching an aggressive asset-purchase program. However, there is an increasing sense the measures are losing their effect and not producing the expected results.
Read: How a ‘twist’ by the Bank of Japan could upstage the Fed
“The BOJ has a particularly difficult job as it appears to be limited in what it can do that will both help it achieve its inflation target, which it is currently far from doing, and appease the markets and prevent the yen appreciating once again, making its job even more difficult,” Erlam said.
The BOJ rate decision is due before the U.S. markets open on Wednesday.
The yen USDJPY, -0.05%  was trading mixed against other currencies on Tuesday, with the dollar buying ¥ 101.94, relatively flat compared with ¥101.92 late Monday in New York.
The U.S. ICE Dollar Index DXY, +0.01%  was down 0.1% at 95.684.
Economic news: On a relatively quiet day on the economic calendar, housing starts and building permits for August are the key data releases set for 8:30 a.m. Eastern Time.
See: MarketWatch’s economic calendar
Barron's Bounce: Bet on Meg Whitman and HPE
Stocks moving after a mention in Barron's Magazine include Hewlett-Packard Enterprises, builder CalAtlantic and water specialist PICO.
Movers and shakers: Shares of Community Health Systems Inc. CYH, -9.76%  jumped 9.2% in thin premarket trade after news the struggling hospital operator is exploring a possible sale.
Chesapeake Energy Corp. CHK, -7.35%  could also be active after activist investor Carl Icahn in late trade on Monday said he had sold more than half of his stake in the energy company.
SeaWorld Entertainment Inc. SEAS, +0.55%  slumped 6.2% ahead of the bell after the theme-park operator said it would suspend its quarterly dividend.
FedEx Corp. FDX, +1.49%  was also in the limelight following an announcement the courier giant plans to raise shipping rates next year.
Ahead of the market open, home builder Lennar Corp. LEN, +1.69%  is due to report fiscal third-quarter earnings.
Ascena Retail Group Inc. ASNA, +1.88%  shares tumbled more than 20% premarket after the owner of Ann Taylor and other apparel brands delivered fourth-quarter results that at were weaker than expectations.
Other markets: Oil prices eased back again, as caution crept in ahead of the duo of central bank decisions. Metals mostly rose, but with silver SIZ6, -0.05%  bucking the trend and inching 0.1% lower.
Asian stocks closed mostly lower, while European equity markets struggled for direction in early trade.