Here are five things you must know for Wednesday, June 29:
1. -- Stock Futures Lower on Recession Concerns
U.S. equity futures edged lower Wednesday, while the dollar found favor against its global peers and bond yields inched south, as global markets quickly retreated from bets on a near-term recovery to focus on prospects of a looming recession.
Much of that concern is linked to the impact central bank rate hikes, designed to fight the fastest inflation in a generation, will have on both consumer demand and broader economic growth.
Cleveland Federal Reserve Bank President Loretta Mester, in fact, told CNBC Wednesday that she would back a 75 basis point rate increase next month if economic conditions were to remain unchanged.
A reading of U.S. consumer confidence yesterday was the lowest in nearly two years, while data from manufacturing to housing to retail sales suggests a broad-based slowdown in the world's biggest economy.
Investors are still holding out hope, however, that central bankers will ease up on their inflation fight if the economy slips into recession, and may get at least an indication of that from speeches later today at the European Central Bank's annual forum in the resort town of Sintra in Portugal.
Federal Reserve Chairman Jerome Powell, ECB President Christine Lagarde and Bank of England Governor Andrew Bailey are all slated to speak at the event, which begins at around 8:30 am Eastern time.
Ahead of that, and with global stocks nursing steep losses following last night's sell-off on Wall Street, the U.S dollar index -- which tends to rise against its global peers when investors are taking a defensive tone in the markets -- gained 0.05% to trade at 104.522, while benchmark 10-year Treasury note yields eased to 3.158% during European dealing.
Europe's region-side Stoxx 600 index, on pace for its worst quarterly decline since the pandemic, was marked 0.84% lower in early Frankfurt trading, following on from a 1.6% slump for the MSCI ex-Japan index in Asia.
On Wall Street, futures tied to the S&P 500, which remains firm entrenched in bear-market territory, are indicating a 7 point opening bell dip while those liked to the Dow Jones Industrial Average are priced for a 25 point decline. Futures linked to the tech-focused Nasdaq are indicating a 35 point slide.
2. -- Tesla Shares Slide Amid Reports of California Layoffs
Tesla TSLA shares edged lower in pre-market trading following a report that the clean-energy carmaker has laid off around 200 workers in a California office focused on its auto pilot system.
The layoffs, first reported by Bloomberg, are said to affect hourly workers at the San Mateo location, a move that would contradict CEO Elon Musk's assertion that the 10$ job cuts he said would be needed would only affect salaried employees.
The decision also suggests Tesla is heading into a period of deep cost cuts following a difficult second quarter marred by production halts in Shangahi, surging input costs, supply chain snarls and the worst three-month decline for bitcoin -- a major Tesla investment -- in more than four years.
Tesla said earlier this spring that current quarter deliveries should be flat when compared to the first three months of the year, even with the multi-week shutdown of its Shanghai gigiafactory -- which made around half of the group's cars last year -- amid China's 'zero Covid' crackdown. The full-year delivery estimate stands at 1.47 million units.
Tesla shares were marked 1.5% lower in pre-market trading at $687.60 each.
3. -- Disney Shares Get Bump As Board Extends CEO Bob Chapek
Walt Disney (DIS) shares edged higher in pre-market trading following a move by the entertainment giant's board of directors to extend the contract of CEO Bob Chapek by another three years.
Chapek, who took over from longtime boss Bog Iger in February of 2020, has steered the company through the worst of the Covid pandemic, and maintained both investment and interest in the group's lucrative Disney+ streaming service.
However, he has also courted controversy through his handling of the company's reaction to Florida's LGBTQ laws and the abrupt departure of entertainment executive Peter Rice.
"Disney was dealt a tough hand by the pandemic, yet with Bob at the helm, our businesses -- from parks to streaming -- not only weathered the storm, but emerged in a position of strength," said board chair Susan Arnold. "Bob is the right leader at the right time for The Walt Disney Company, and the board has full confidence in him and his leadership team."
Disney shares were marked 0.5% higher in pre-market trading to indicate an opening bell price of $96.41 each, a move that would still leave the stock with a year-to-date decline to around 37.75%.
4. -- Pinterest Shares Leap As CEO Ben Silbermann Makes Way For Former Google Executive
Pinterest PINS shares powered higher in pre-market trading following news that longtime CEO Ben Silbermann will leave the group to make way for former Google (GOOGL) executive Bill Ready.
Silbermann, who co-founded the image-sharing social media group in 2010, will transition to the role of executive chairman -- while keeping a seat on the company board -- as Ready, who has also held senior leadership roles at PayPal (PYPL), takes over.
"As you can imagine, this was a hard decision. So much of my heart belongs to Pinterest. I guess you could call it a founder's love," Silbermann told Pinterst employees. "And, when you care about something so much, the natural instinct is to hold it as tight as you can. But often, the most loving thing to do is let it go and watch it flourish in new ways. That's what is going to happen with Bill at the helm."
Pinterest shares were marked 5.3% higher in pre-market trading to indicate an opening bell price of $20.74 each.
5. -- Delta
Delta Air Lines (DAL) shares slipped lower in pre-market trading after the carrier said it would relax some of its re-booking rules ahead of what could be another disrupted holiday weekend for American travelers.
Delta said passengers can change flights heading into or out of the weekend, for the same fare, heading into what the carrier called a "potentially challenging weekend."
Staff and pilot shortages, as well as bad weather and airport congestion, lead to the cancellation of more than 700 flights on Monday, according to Flightaware.com, including 200 from Delta alone.
The disruptions come as TSA data shows the highest volume of domestic air passengers since before the pandemic began in February of 2020, with more than 2.45 million screenings recorded on June 25.
Transportation Secretary Pete Buttigieg, who met with airline executives earlier this month, has warned of potential enforcement actions if airlines -- which received billions of taxpayer support during the worst of the pandemic -- fail to hire more staff of mange their schedules more competently.
Delta shares were marked 0.73% lower in pre-market trading to indicate an opening bell price of $30.11 each.
