Dow futures slide as Federal Reserve signals a rate hike as soon as March

Wall Street

Fed lays the groundwork for its first interest rate hike since pandemic

U.S. stocks look set for more losses on Thursday after the Federal Reserve kept interest rates near zero Wednesday, at the conclusion of its two-day policy meeting, and signaled it is preparing to hike rates at its next meeting in mid-March.

Fed chair Jerome Powell said during a news conference after the conclusion of the meeting that the American economy “no longer needs sustained high levels of monetary policy support.”

“This is a very, very strong labor market. My strong sense is we can move rates up without having to severely undermine it,” Powell added.

A rate hike in March will be the first since 2018, with analysts betting that the central will raise rates four times this year.

As of 6 a.m. ET, futures tied to the Dow gave away 106 points, or 0.31% to 33,949. S&P 500 futures dropped 14.25 points, or 0.33% to 4,327.25 while the tech-heavy Nasdaq 100 futures shed 55 points, or 0.39% to 14,103.5.

Tesla posts record yearly profit, warns of supply chain constraints

Shares of Tesla (NASDAQ: TSLA) are trading slightly lower after the company reported fourth-quarter and full-year financial results after the market closed on Wednesday.

The EV juggernaut said in a press release that it had earnings of $2.54 per share in the fourth quarter, topping a consensus estimate of $2.26 per share. Revenue grew 65% year-over-year to $17.7 billion, beating analyst estimates of $16.4 billion.

For the full year, the company posted a record profit of $5.5 billion and revenue of $53.8 billion. That compares to profit of $721 million and revenue of $31.5 billion in 2020.

Tesla told its shareholders that supply chain was “the main limiting factor” to growth and warned that its “likely to continue through 2022.”

Shares of the company were down 1.11% to $927.00 apiece in the premarket trading session.

Apple earnings on deck

Today earnings calendar includes Apple (NASDAQ: AAPL), which is scheduled to report its fiscal first-quarter earnings after the closing bell.

The iPhone marker is expected to have earned $1.88 per share on revenue of $118.28 billion during the quarter.

Other major earnings to watch today include Comcast (NASDAQ: CMCSA), McDonald’s (NYSE: MCD), Visa (NYSE: V), Mastercard (NYSE: MA), Southwest Airlines (NYSE: LUV), Blackstone (NYSE: BX), Altria (NYSE:MO), and Western Digital (NASDAQ: WDC).