Here are five things you must know for Wednesday, June 9:
1. -- Stock Futures Fluctuate as S&P 500 Trades Near Record High
Stock futures fluctuated Wednesday after the S&P 500 finished just shy of a record closing high.
Contracts linked to the Dow Jones Industrial Average were down 29 points, S&P 500 futures rose 3 points and Nasdaq futures gained 40 points.
Stocks finished mostly higher Tuesday as traders looked for clues on what impact rising prices pressures may have on the Federal Reserve's support for a U.S. economy recovering from the COVID-19 pandemic.
The S&P 500 ended Tuesday at 4,227, just off its closing high on May 7 of 4,232.
The focus for traders remains on the Labor Department's report Thursday on consumer prices and what it might mean for the Fed's accommodative policies. The fear is that if the economy runs too hot and inflation runs too high the Fed may pare back on its monthly asset purchases and boost interest rates sooner than anticipated.
The Fed repeatedly has tried to assure markets that any spike in inflation resulting from the country's economic recovery would be transitory.
Oil prices in the U.S. rose above $70 a barrel early Wednesday.
Bitcoin was rising almost 5% to $34,504 but it and other popular digital currencies such as Ethereum and Dogecoin remained under pressure.
2. -- Wednesday's Calendar: GameStop Earnings
Earnings reports are expected Wednesday from GameStop (GME) - Get GameStop Corporation Report, Campbell Soup (CPB) - Get Campbell Soup Company Report, Vera Bradley (VRA) - Get Vera Bradley Inc. Report and Hexo (HEXO) - Get HEXO Corp. Report.
The U.S. economic calendar on Wednesday includes MBA Mortgage Applications for the week ended June 4 at 7 a.m. ET and Oil Inventories for the week ended June 4 at 10:30 a.m.
3. -- Lordstown Motors Extends Slump After Going Concern Notice
Lordstown Motors (RIDE) - Get Lordstown Motors Corp. Report extended losses in premarket trading Wednesday after the maker of electric trucks said in a regulatory filing that it didn't have enough cash on hand to build vehicles at scale and sell them, and that "these conditions raise substantial doubt regarding our ability to continue as a going concern."
The stock fell 3.48% early Wednesday to $10.83. The shares slumped more than 16% on Tuesday.
"The Company's ability to continue as a going concern is dependent on its ability to complete the development of its electric vehicles, obtain regulatory approval, begin commercial scale production and launch the sale of such vehicles," Lordstown said in filings with the Securities and Exchange Commission. "The Company believes that its current level of cash and cash equivalents are not sufficient to fund commercial scale production and the launch of sale of such vehicles."
When the company reported a wider-than-expected first-quarter loss in May it also said 2021 production of its Endurance truck would be half prior expectations.
Lordstown Motors was founded in 2018 and went public in October through a merger with a special-purpose acquisition company.
4. -- Clover Health Rides Meme-Stock Surge
Clover Health Investments (CLOV) - Get Clover Health Investments Corp. Report continued its surge Wednesday, rising more than 20% in premarket trading, following record highs on Tuesday that appeared to be driven by meme stock investors rallying around the healthcare plan company.
Clover Health, backed by venture capitalist Chamath Palihapitiya, finished at $22.15 on Tuesday, a gain of more than 85%.
Trading volume in Clover Health was more than 25 times the three-month daily average on Tuesday, with a record 618 million shares changing hands, according to Bloomberg.
Chatter on Reddit forum WallStreetBets hinted at a short-squeeze in the stock.
"Everyone hold if you can," one poster on Reddit said. "This is just literally Day 1 of the squeeze. Just getting started. $CLOV to $250."
5. -- Jeff Bezos and Elon Musk Avoid Paying Income Taxes
The 25 richest Americans, including Amazon.com (AMZN) - Get Amazon.com Inc. Report founder Jeff Bezos, frequently paid little or no income tax in recent years, according to a published report based on detailed tax data for the period.
In addition to Bezos, Tesla’s (TSLA) - Get Tesla Inc. Report Elon Musk, former New York Mayor Michael Bloomberg and activist investor Carl Icahn have all managed to pay zero income tax in at least one year of the past 15, ProPublica reported, citing detailed data it analyzed from unnamed sources. Billionaire investor George Soros managed to pay no income tax three years in a row.
In 2011, when Bezos paid no income tax, he even claimed and received a $4,000 tax credit for his children, according to the report. From 2006 to 2018, Bezos saw his wealth rise $127 billion, according to the report. Over the period he reported $6.5 billion in income on which he paid $1.4 billion in federal taxes. When compared with his overall gains, that amounts to a 1.1% “true tax rate on the rise in his fortune,” ProPublica reported.
The actions by the ultra rich to avoid paying taxes are legal. They can escape taxes by avoiding income and capital gains altogether and instead borrowing against their substantial assets, the report from ProPublica noted.