Wednesday, October 21, 2020 – U.S. equities are poised for a muted open on Wednesday, as investors digest a slew of earnings reports and continue to monitor progress on a fiscal stimulus bill. The Dow and S&P 500 are both little changed, while the Nasdaq 100 is down 0.1% in pre-market action. Yesterday, stocks and longer-dated Treasury yields rose after House Speaker Nancy Pelosi expressed optimism after reportedly narrowing differences during discussions with Treasury Secretary Steven Mnuchin. However, the two sides were unable to reach an agreement before yesterday’s self-impose deadline, but the White House and Democrats will continue talks this week.

In earnings, Netflix is sliding 5.4% after the streaming giant’s earnings and subscriber growth metric both fell short of analysts’ projections. Meanwhile, social media company Snap is surging 21.3% after reporting a surprise profit in the third quarter and exceeding Wall Street’s estimates for daily active users.

Today’s lone economic update showed MBA mortgage applications dipped 0.6% in the week ending October 16. In central bank news, the Federal Reserve will release its Beige Book at 2pm ET. A slew of Fed speakers may also garner attention, with six different officials scheduled to give remarks today. Treasuries are weakening, with the yield on the 10-year Treasury trading above 0.80% for the first time since June.

Overnight in Asia, China’s Shanghai Composite fell 0.1%, while Hong Kong’s Hang Seng Index rose 0.8%. Across the pond, the Euro STOXX 600 is retreating 0.9%. The FTSE 100 is falling 1.2% with Prime Mister Boris Johnson suggesting regional COVID-19 related lockdowns.

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Benjamin J. Chuckrow
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