Before the bell: What you need to know before the US market open
Markets are still reeling from the Fed's warning that they're not taking the possibility of a June interest rate hike seriously enough and ratings agency Moody's has downgraded US growth prospects.
Here's what you need to know before the US market open at 2:30pm London time.
The pre-market is not looking strong this morning follow the Fed minutes last night from their April meeting. The S&P is down by 0.22 per cent, the Nasdaq is down by 0.23 per cent, and the Dow is off by 0.18 per cent.
The US 10-year bond yield is up two basis points at 1.87 per cent.
In Europe…
European markets are broadly lower, following a poor performance in Asia overnight.
Adding to macroeconomic concerns is the tragic news that Egyptair flight MS804 crashed in the Mediterranean overnight.
"The information we have gathered – ministers, members of government and, of course, the Egyptian authorities – confirm, sadly, that it has crashed. It is lost," French president Francois Hollande said in a press conference, translated by the BBC.
The news is weighing on travel and tourism stocks that have already been knocked by disasters earlier this year.
Back in the US…
The April Federal Open Market Committee minutes were released at 7pm last night London time, and they suggested that if conditions are right, the Fed may raise rates in June, taking markets somewhat off guard. It had been thought the minutes could reveal a December hike was on the cards.
Perhaps muting the news however, Moody's has downgraded US growth forecasts to two per cent from 2.3 per cent previously, warning the slowing of the Chinese economy could have a "significant" impact on financial markets.
Stocks to watch
The worlds largest bricks-and-mortar retailer Walmart is surging in the pre-market, up by 9.2 per cent. The company posted first-quarter earnings per share of 98 cents, versus $1.03 a share in the year-earlier period and beating analyst expectations of 88 cents per share.
Chris Horvers, retail analyst at JP Morgan, called the quarter "really impressive."
Not so impressive though was Walmart's UK subsidiary Asda – posting a 5.7 per cent fall in like-for-like sales for the 13 weeks to 30 March.
But for now Walmart is soaring. Sales were up for the seventh consecutive quarter – up one per cent – as customer experience scores continued to improve.
More mergers to come…
In the latest round of consolidation in the agribusiness and chemical sectors, German chemical and pharmaceutical firm Bayer has made an undisclosed offer to buy US seed company Monsanto.
There is a serious danger the deal would be blocked on antitrust grounds however due to the weight of the company in the global seeds business.
Read more: Seed company's shares grow after news of $43bn takeover interest
Last year, Dow Chemical and DuPont announced they would combine to form a new industrial titan worth $130bn.
Companies reporting earnings today
A quieter day on the reports today: We've already heard from Walmart and Dicks Sporting Goods.
After the close fashion retailer Gap will deliver its latest numbers.
Economic data out today
Data today from Philadelphia Fed's Initial and continuing claims is already out with leading indicators at 3pm London time.
At 3:30pm we'll get the latest natural-gas inventories.