Nasdaq May Reach New Record High In Early Trading

Stocks may move to the upside in early trading on Wednesday, with the tech-heavy Nasdaq potentially reaching another new record high. While the Dow futures are pointing to a slightly higher open, rising by just 30 points, the Nasdaq futures are up by 79 points.

The Nasdaq may continue to benefit from gains by big-name tech companies such as Apple (AAPL), Amazon (AMZN), Facebook (FB) and Google parent Alphabet (GOOGL), which are all moving higher in pre-market trading.

Early trading activity may be somewhat subdued, however, as traders look ahead to the Federal Reserve’s monetary policy announcement this afternoon.

The Fed is widely expected to leave interest rates and policy unchanged, but traders will pay close attention to the accompanying statement for clues about future policy changes.

Some investors are hoping the Fed will provide more clarity about the unlimited bond purchasing programs announced in March.

The central bank is also due to provide its first economic projections since the coronavirus crisis began, which could impact traders’ generally optimistic outlook for a quick economic recovery.

In U.S. economic news, the Labor Department released a report showing a modest decrease in consumer prices in the month of May.

The Labor Department said its consumer price index edged down by 0.1 percent in May after slumping by 0.8 percent in April. Economists had expected consumer prices to come in unchanged.

The dip in consumer prices came as lower prices for motor vehicle insurance, energy, and apparel more than offset increases in prices for food and shelter.

The report said core consumer prices, which exclude food and energy prices, also slipped by 0.1 percent in May after falling by 0.4 percent in April. Core prices were also expected to come in unchanged.

After moving significantly higher over the past several sessions, stocks gave back some ground during trading on Tuesday, although strength among technology stocks lifted the tech-heavy Nasdaq to a new record high.

The Nasdaq pulled back off its best levels after topping 10,000 for the first time but still closed up 29.01 points or 0.3 percent at 9,953.75. Meanwhile, the Dow slumped 300.14 points or 1.1 percent to 27,272.30 and the S&P 500 slid 25.21 points or 0.8 percent at 3,207.18.

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance on Wednesday. Japan’s Nikkei 225 Index edged up by 0.2 percent, while China’s Shanghai Composite Index fell by 0.4 percent.

The major European markets have also turned mixed on the day. While the U.K.’s FTSE 100 Index has risen by 0.3 percent, the German DAX Index and the French CAC 40 Index are both down by 0.1 percent.

In commodities trading, crude oil futures are sliding $0.65 to $38.29 a barrel after climbing $0.75 to $38.94 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,729.90, up $8 compared to the previous session’s close of $1,721.90. On Tuesday, gold jumped $16.80.

On the currency front, the U.S. dollar is trading at 107.36 yen compared to the 107.76 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.1369 compared to yesterday’s $1.1340.

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