U.S. stock futures were pointing to a modestly lower Wednesday morning open on Wall Street ahead of what the markets in the afternoon expect to be the Federal Reserve's second interest rate cut this year. With gains on Tuesday, the Dow Jones Industrial Average logged nine positive sessions out of the past 10. The S&P 500 and Nasdaq were coming off their first gains in three sessions. In the prior five Fed meeting days this year, the Dow and S&P 500 advanced twice and fell three times.
Fed Chairman Jerome Powell and company are expected to reduce borrowing costs again by 0.25%. However, that move would almost certainly disappoint President Donald Trump who has called the Fed "boneheads" and has said rates should be zero or even negative like other central banks around the world. The Fed rate decision comes at 2 p.m. ET after the central bank's two-day September meeting. Powell holds a news conference at 2:30 p.m. ET. At the Fed's July meeting, Powell rocked markets, describing the first rate cut in more than a decade as a "mid-cycle adjustment."
U.S. oil prices were falling again Wednesday morning after pulling back nearly 5.7% on Tuesday as Saudi Arabia said that full production would be restored quickly after Saturday's attacks on its crude facilities. U.S. Secretary of State Mike Pompeo, who has blamed Iran for the strikes, is set to meet with Saudi Crown Prince Mohammed bin Salman on Wednesday. Iran has repeatedly denied involvement. In the first trading day after the attacks in the kingdom, U.S. crude prices soared nearly 14.7% on Monday.
With U.S. and Chinese officials set for high-level trade talks next month, House Speaker Nancy Pelosi believes the president had to challenge China's trade practices. However, she's not sold that he took the right steps with tariffs to hold Beijing accountable. "I think we should have done it multilaterally, with the EU and the rest," Pelosi told CNBC's Jim Cramer in an interview Tuesday. Pelosi added Trump should not have tried to address China's practices in a way that could open Americans up to financial pain.
Shares of FedEx were sinking about 12% in premarket trading, after the delivery giant blamed the U.S.-China trade war for quarterly earnings and revenue that missed estimates. FedEx lowered full-year guidance for fiscal 2020, now projecting earnings between $10 to $12.00 per diluted share. That revised outlook also reflects "increased FedEx Ground costs and August's loss of FedEx Ground business from a large customer," the company said in a release. In August, FedEx announced it was ending its ground delivery contract with Amazon.