US markets closed mostly lower on Tuesday as a huge slump in Oil prices hit energy shares and disappointing earnings from the world’s biggest retailer Wal-Mart (NYSE:WMT) added further evidence of an uninspired consumer.
The US Dow did manage to edge out a record close on Tuesday but looks like it, alongside other benchmarks will slip away from recent peaks on Wednesday’s open in anticipation of FOMC minutes.
The adjustment in ECB bond-buying announced yesterday sent the euro lower and conversely the US dollar sharply higher. The dollar strength was supported by US housing starts rising over 20% in April from a month earlier to a seven year high.
The US economy is clearly not firing on all cylinders but if the housing market is signalling an impending construction boom, that’s important and can offset some of the weakness in other areas.
The Federal Reserve minutes are now out-of-date but there are some broader issues it could bring up. If the Fed were to voice concern over the strength of the dollar or international concerns with Greece so close to the edge, the dollar’s comeback over the past two days could really kick in.
Yahoo! (NASDAQ:YHOO) shares slumped over 7% in the last 20 minutes of trading on Tuesday after US tax authorities are reported to be preparing to change rules on spin-offs, potentially hindering the sale of Yahoo!’s stake in Alibaba (NYSE:BABA).
Etsy Inc (NASDAQ:ETSY) shares are expected to crash over 10% on the open taking them below last year’s listing price after the Online craft-retailer reported a surprise rise in quarterly losses.
Staples Inc (NASDAQ:SPLS), Target Corporation (NYSE:TGT), American Eagle Outfitters Inc (NYSE:AEO), Salesforce.com Inc (NYSE:CRM), Lowe`s Companies Inc (NYSE:LOW) and L Brands Inc (NYSE:LB) all report earnings on Wednesday.
Futures suggest the:
S&P 500 will open 2 points lower at 2,125 with the
Dow Jones expected to open 12 points lower at 18,000 and the
Nasdaq 100 9 points higher at 4,512.
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