Eyes on FOMC meeting
U.S. stocks look set to open flat on Tuesday as market participants await the Federal Reserve to kick off its first monetary policy meeting of 2021 later in the day.
Traders don’t expect the Fed to announce any shifts in policy stance at the conclusion of the meeting on Wednesday.
But they will be closing listening to Chairman Jerome Powell’s press conference to gauge the strength of the Fed’s commitment to keeping low interest rates and its massive bond-buying program in place if inflation comes back at a faster pace than expected.
Microsoft, AMD, GE, Starbucks earnings on tap
Fourth-quarter earnings reports continue to come in a flurry as several big companies are scheduled to report today.
Lockheed Martin (NYSE: LMT), Novartis (NYSE: NVS), Verizon (NYSE: VZ), Johnson & Johnson (NYSE: JNJ), 3M (NYSE: MMM), General Electric (NYSE: GE), and Prologis (NYSE: PLD) will report before the opening bell.
Companies reporting after the closing bell include Microsoft (NASDAQ: MSFT), Starbucks (NASDAQ: SBUX), Advanced Micro Devices (NASDAQ: AMD), Texas Instruments (NASDAQ: TXN), and American Express (NYSE: AXE).
GameStop volatility continues thanks to day traders on Reddit
Meanwhile, GameStop (NYSE: GME) shares soared 17.61% to $90.31 in pre-market trading Tuesday, extending Monday’s rally, thanks to a war between short-sellers and day traders on Reddit.
In five days, shares of the gaming retailer have jumped from about $40 to hit a record high of $159.18 on Monday, as bullish day traders on Reddit forum WallStreetBets went on a buying spree in direct opposition to a group of short-sellers who are betting that the stock will sink.
Traders on the forum have been touting GameStop aggressively and urged others to join the trade.
Janet Yellen confirmed as first woman U.S. treasury secretary
In other news, the Senate on Monday approved Biden’s nomination of Janet Yellen to be the U.S. Treasury Secretary, making her the first female to lead the department.
The former Fed chair was approved by the Senate on a 84-15 vote, with all opposition coming from GOP senators, a number of whom have expressed concerns about the $1.9 trillion coronavirus relief package that Biden has proposed.
She will play an important role in working with lawmakers on the package and on the president’s promises to invest $2 trillion in infrastructure, education, research, and climate-friendly projects.