Here are five things you must know for Tuesday, September 21:
1. -- Stock Futures Rebound Ahead Of Fed Meeting Kick-Off
Wall Street futures rebounded firmly Tuesday as investors looked to claw back losses from the biggest single-day decline in nearly four months amid ongoing concerns over the fate of China's indebted property giant and the start of the Federal Reserve's crucial policy meeting.
Global stocks stabilized Tuesday, as well, with Asia booking modest gains -- even as mainland China markets remained closed for a public holiday -- and Europe getting a modest bounce from the loosening of travel restrictions with the United States and an impressive debt for newly-listed Universal Music Group.
A late-hour rally on Wall Street pared some of yesterday's declines, the largest since May, as investors took a second look at the impact of China Evergrande's impending default and scooped up cheap stocks heading into tomorrow's announcement from the Fed from its two-day policy meeting.
Futures contracts tied to the Dow Jones Industrial Average are indicating a 350 point opening bell gain Tuesday, paced by energy and financial shares, while those linked to the S&P 500 are priced for a 41 point rebound from yesterday's slump, which pulled the benchmark into a month-to-date decline of around 3.65%.
Nasdaq Composite futures are set for a more modest 140 point gain, however, as some of the big tech names that lead yesterday's decline may struggle to find favour as benchmark 10-year note yields hold at 1.336%.
2. -- Evergrande Chairman Vows To Ride Out 'Darkest Moment'
China Evergrande Group (EGRNF) chairman Hui Ka Yuan told staff of the world's most indebted property group that his company would "walk out of its darkest moment, resume full-scale constructions as soon as possible".
The brave tone belies a series of financial challenges for what is not only China's biggest property developer, but also its largest systemic financial risk as it faces both a liquidity crunch linked to hundreds, and possibly thousands, of unfinished projects and the looming specter of $850 million in bond payments -- including $150 due Thursday -- between now and the end of the year.
Ratings company Standard & Poor's said Evergrande is likely to default in the coming weeks, but noted the authorities in Beijing would likely "be compelled to step in if there is a far reaching contagion causing multiple major developers to fail and posing systemic risks to the economy."
China Evergrande shares fell another 7% from the eleven-year lows it hit yesterday in Hong Kong trading, but pared some of those losses later in the session to close at HK$2.27 each, extending their six-month slump to around 85%.
3. -- Lennar Cautions On Supply Chain Hit to Housing
Lennar Corp. (LEN) - Get Lennar Corporation Class A Report added its name to the growing list of homebuilders warning of supply chain disruptions to its current quarter earnings late Monday, sending shares lower in pre-market trading.
Lennar, the nation's second-largest homebuilder, said "our company and the homebuilding industry as a whole continued to experience unprecedented supply chain challenges which we believe will continue into the foreseeable future" during the third quarter, adding that it expects to finish fewer homes -- 18,000 versus a prior forecast of 20,343 -- over the final three months of the year.
The forecast echoes that of its larger rival, DR Horton (DHI) - Get D.R. Horton, Inc. Report, which trimmed its fourth quarter sales forecasts yesterday, as well as that of PulteGroup (PHM) - Get PulteGroup, Inc. Report, which issued a similar warning earlier this month.
Lennar shares were marked 1.1% lower in pre-market trading Tuesday at $97.23 each while DR Horton edged 0.8% higher to $88.80 each.
4. -- Trudeau Wins Third Term, Claims 'Clear Mandate'
Justin Trudeau looks set to win a third term as Canada's Prime Minister following a bruising election that is once again likely to deliver a minority government for the left-leaning Liberal Party.
Trudeau, who had called the two years earlier than needed in order to win a firmer mandate to lead the country out its COVID pandemic malaise, likely steered the Liberals to victory in 156 of the 338 seats in the House of Commons, around 14 shy of the majority needed to pass legislation without the support of other parties.
The second place Conservatives, lead by former Air Command pilot Erin O'Toole, look set to win 122 seats, based on early Tuesday vote counts.
“I hear you when you say you want to get back to the things you love, not to worry about the pandemic or the election,” Trudeau told supporters in his home riding of Papineau, in western Montreal, early Tuesday morning. “You have given this government and this parliament clear direction.”
5. -- Universal Music Group Delivers Dutch Treat IPO Debut
Universal Music Group shares soared on their trading debut in Amsterdam Tuesday, putting the value of the label behind artists such as Lady Gaga and Ariana Grande at more than $55 billion.
UMG, which was spun off from French media giant Vivendi, is Europe's largest listing so far this year and certainly its most popular. Shares in the group gained more than 35% from their reference price of €18.50 in early Amsterdam trading to change hands at €25 each by mid-day.
With a catalogue of artists ranging from Bob Dylan and the Rolling Stones to Canadian R&B singer The Weeknd, UMG is the largest music label in the world by revenue with 2020 sales of €7.43 billion ($8.7 billion).
Billionaire hedge fund manager Bill Ackman, who runs Pershing Square Holdings, will own a 10% stake in the listed group, as will parent company Vivendi. China's Tencent owns 20%.