Here are five things you must know for Wednesday, April 7:
1. — Stock Futures Inch Higher Ahead of Fed Minutes
Stock futures inched higher Wednesday after the S&P 500 snapped a three-day winning streak in a lackluster Wall Street session.
Contracts linked to the Dow Jones Industrial Average were up 14 points, S&P 500 futures rose 2 points and futures on the tech-heavy Nasdaq gained 6 points.
Investors Wednesday awaited details of the Federal Reserve’s meeting in March, hoping to gauge the central bank’s outlook for the U.S. economy and seeking clues on when the Fed might next hike rates from record low levels.
At the March meeting, the U.S. central bank projected interest rates would remain near zero through at least through 2023 and upgraded its outlook for economic growth. It also said inflation likely would rise past 2% in the coming months.
Any concerns investors may have had about rising U.S. borrowing costs have eased, sending benchmark U.S. Treasury yields lower. The 10-year fell to 1.646% early Wednesday. As recently as last week, yields traded at a 14-month high of about 1.78%.
Stocks finished lower on Tuesday, a day after equities rallied to all-time highs on optimism about a U.S. economic rebound. Volume on U.S. exchanges was below 10 billion shares for the first time this year, according to Bloomberg.
The International Monetary Fund said it expects the U.S. economy to expand 6.4% in 2021 – its fastest growth since 1984 – and 3.5% in 2022. That growth is being supported by President Joe Biden’s $1.9 trillion coronavirus relief package, and an acceleration in the rollout of vaccines.
2. — Wednesday’s Calendar: Fed Minutes, Carnival Earnings
The U.S. economic calendar for Wednesday includes International Trade in Goods and Services for February at 8:30 a.m. ET and minutes from the Federal Reserve’s March 16-17 meeting at 2 p.m.
3. — Jeff Bezos Supports Corporate Tax Rate Hike
Jeff Bezos, the founder and CEO of Amazon.com (AMZN) – Get Report, said he supported President Biden’s proposed $2.3 trillion infrastructure proposal and backed a corporate tax rate hike to help pay for it.
“We support the Biden administration’s focus on making bold investments in American infrastructure. Both Democrats and Republicans have supported infrastructure in the past, and it’s the right time to work together to make this happen,” Bezos said in a blog posted on Amazon’s website.
“We recognize this investment will require concessions from all sides – both on the specifics of what’s included as well as how it gets paid for (we’re supportive of a rise in the corporate tax rate),” he added.
Biden last week singled out Amazon for not paying its share of federal taxes, saying the tech and retailing giant uses “various loopholes so they’d pay not a single solitary penny in federal income tax.”
Biden has proposed hiking the U.S. corporate tax rate to 28% from 21% to help pay for his plan.
4. — Coinbase Expects First-Quarter Profit of Up to $800 Million
Coinbase Global, preparing for its listing on the Nasdaq next week, said it expects first-quarter profit of $730 million to $800 million, more than double what it earned in all of 2020, on revenue of $1.8 billion.
The largest U.S. cryptocurrency exchange reported revenue for all of last year of just $1.3 billion.
Coinbase said it had 56 million verified users users in the first three months of 2021.
Coinbase Global will make its trading debut through a direct listing on the Nasdaq on April 14. The direct listing had been pushed back from March. It will trade under symbol “COIN.”
Coinbase was valued at about $90 billion in its final week of trading on Nasdaq’s private market, according to Bloomberg.
5. — Toshiba Weighs Buyout Proposal From CVC
Japanese conglomerate Toshiba (TOSYY) said it was considering a buyout proposal from private-equity giant CVC Capital Partners.
Toshiba said Wednesday that it asked for more details on the proposal. Reports said its board would meet Wednesday to discuss the offer.
Japan’s Nikkei reported CVC plans to propose a deal to take Toshiba private through a tender offer that could be worth more than $20 billion. That would make it the largest private equity-led buyout since 2013, and CVC’s biggest acquisition on record, Bloomberg reported.
Trading in Toshiba shares was suspended Wednesday after they surged to their daily limit of 18%.
Toshiba, founded in 1875, was long revered as one of Japan’s most respected brands, but a series of scandals have led to scrutiny from activists.