Here are the most important news, trends and analysis that investors need to start their trading day:
1. Wall Street looks steady after Wednesday’s major Fed-driven sell-off
Trader at the NYSE, Jan. 3, 2022.
Dow futures crept higher but Nasdaq futures moved lower Thursday, one day after a major Federal Reserve-driven sell-off, the first regular trading session decline of the year on Wall Street. Minutes from the Fed’s December meeting revealed central bankers are getting ready to remove economic help more quickly than previously anticipated.
2. Fed puts wheels in motion for starting to reduce its massive balance sheet
Federal Reserve Board Chairman Jerome Powell waits for the beginning of a hearing before Senate Banking, Housing and Urban Affairs Committee on Capitol Hill November 30, 2021 in Washington, DC.
Alex Wong | Getty Images
The Fed at its December meeting began plans to start cutting the amount of bonds held on its balance sheet, with members saying such a reduction would likely start sometime after the central bank begins raising interest rates. That’s according to minutes from the meeting released Wednesday.
- Expectations currently are for the Fed to start hiking rates in March, which would mean that a balance sheet reduction could start before summer.
- After the December meeting, the Fed announced plans to more aggressively taper its bond purchases.
- Central bankers are set to hold their first meeting of the new year on Jan. 26-27. With Covid cases spiking due the omicron variant, traders will be keen to see if the Fed adjusts its plans.
3. Investors get jobless claims data, one day before December employment report
A job seeker leaves the job fair for airport related employment at Logan International Airport in Boston, Massachusetts, U.S., December 7, 2021.
Brian Snyder | Reuters
Central bankers and investors got another read on the health of the labor market Thursday morning. The government’s look at jobless claims for the week ended Jan. 1 showed a slightly higher-than-expected 207,000 initial filings. That’s just about the same as the previous week’s level, which was near the lowest mark since 1969.
- The government is scheduled to release its December employment before the bell on Friday. Nonfarm payrolls are expected to grow by 422,000 positions, with an unemployment rate seen dipping to 4.1%.
- ADP’s December look at hiring at U.S. companies more than doubled estimates, with 807,000 new private sector jobs created. Data from ADP has not been the best at predicting the government’s monthly report during the pandemic.
4. Walgreens shares rise on earnings; Bed Bath & Beyond’s stock reverses
Walgreens in Oakland, Calif.
Yalonda M. James | San Francisco Chronicle | Hearst Newspapers via Getty Images
Dow stock Walgreens Boots Alliance rose more than 4% in the premarket after the pharmacy chain on Thursday morning reported better-than-expected fiscal first-quarter earnings and revenue. Walgreens also raised its full-year forecast as customers came to its stores for Covid vaccines and testing. The company’s shares closed Wednesday at $54, up nearly 1%. The stock has gained 30% over the past 12 months, as of Wednesday’s close, bringing the market value to more than $46.7 billion.
Customer shopping in a Bed Bath & Beyond store
Courtesy: Bed Bath & Beyond
Bed Bath & Beyond shares reversed losses to gains in the premarket after the home goods retailer on Thursday morning missed expectations for its fiscal third quarter. Bed Bath & Beyond, a so-called meme stock prone to volatility, reported a loss when analysts had expected a break-even result. Revenue was below estimates. The company’s CEO said a lack of inventory due to supply chain bottlenecks cost Bed Bath & Beyond about $100 million.
5. CDC backs Pfizer booster shots for kids ages 12-15 as omicron surges
The Centers for Disease Control and Prevention (CDC) headquarters in Atlanta, Georgia.
Tami Chappell | Reuters
Children ages 12 to 15 are now eligible for Pfizer and BioNTech’s Covid booster shots, giving them an extra dose of protection as they return to school amid an unprecedented surge of infections across the U.S. The Centers for Disease Control and Prevention on Wednesday recommended boosters for younger adolescents at least five months after their second doses. Hospitalizations of children infected with Covid are rising in the U.S. as omicron drives a wave of infection in the broader population. At least 7.8 million children have caught Covid since the pandemic started, according to the American Academy of Pediatrics. More than 1,000 children have died from the virus, according to CDC data.
— Follow all the market action like a pro on CNBC Pro. Get the latest on the pandemic with CNBC’s coronavirus coverage.