Chesapeake Energy, T-Mobile, Federal Reserve - 5 Things You Must Know Tuesday

The Fed's bond-buying plans boost stock futures; Chesapeake Energy reportedly could file bankruptcy this week; T-Mobile says texting and calling on its network have been restored.
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Here are five things you must know for Tuesday, June 16:

1. -- Stock Futures Jump on Fed's Bond-Buying Plans

Stock futures pointed higher Tuesday and shares in Asia and Europe rose on continued central bank support, including the latest move by the Federal Reserve to support markets.

Contracts linked to the Dow Jones Industrial Average rose 510 points, futures for the S&P 500 gained 43 points and Nasdaq futures were up 132 points.

The Fed is expected to begin buying corporate bonds Tuesday. The central bank will purchase the bonds under its Secondary Market Corporate Credit Facility, an emergency lending program, using an indexed approach. The move builds on the Fed's purchase of corporate bond ETFs, which started last month.

“In case the generosity of the Fed was in any doubt, it is not. Global equity markets are recovering quickly” after the Fed announcement, said Stephen Innes, chief global markets strategist at AxiCorp.

Stocks also were rising on a Bloomberg report that said the Trump administration was preparing a $1 trillion infrastructure proposal in an effort to boost the U.S. economy. 

Stocks finished higher Monday - erasing sharp losses from earlier in the session - after the Federal Reserve announced its bond-buying plans.

The Dow rose 157 points, or 0.62%, to close at 25,763, the S&P 500 gained 0.83% and the Nasdaq rose 1.43%. At one point Monday, the Dow was down more than 760 points on concerns over a second wave of coronavirus infections.

2. -- Retail Sales, Jerome Powell on Tuesday's Calendar

The economic calendar Tuesday includes Retail Sales for May at 8:30 a.m. ET. Economists forecast a rebound to 7.5% from contractions of 8.7% in March and 16.4% in April. Excluding autos and gas, retail sales are expected to rise 5.2%.

The calendar also includes Industrial Production for May at 9:15 a.m.

Federal Reserve Chairman Jerome Powell will testify - virtually - on monetary policy before the Senate Banking Committee on Tuesday at 10 a.m. ET. He will appear before the House Financial Services Committee on Wednesday.

The earnings calendar Tuesday includes Oracle  (ORCL) - Get Report, Groupon  (GRPN) - Get Report and H&R Block  (HRB) - Get Report.

3. -- Chesapeake Energy Could File for Bankruptcy This Week

Chesapeake Energy  (CHK) - Get Report is preparing to file for bankruptcy as soon as this week, Reuters reported, citing three people familiar with the matter.

The shale oil and gas producer, struggling with a plunge in crude oil prices, is in the final stages of negotiating a roughly $900 million debtor-in-possession loan to support its operations while under Chapter 11 bankruptcy-court protection, two of the sources told Reuters.

The company also is talking with creditors to “roll up” some of its existing debt and make it part of the bankruptcy loan, bringing the total DIP financing closer to $2 billion, the sources added. 

Chesapeake, with debt of more than $9 billion, could complete its negotiations with creditors and file for bankruptcy as soon as Thursday, Reuters reported.

The stock was rising 6.52% in premarket trading to $20.10.

4. -- T-Mobile Says Texting and Calling Restored

T-Mobile  (TMUS) - Get Report said early Tuesday that texting and calling on the mobile carrier's network were again working following a major outage.

"Voice and text services are now restored. Thank you for your patience as we fixed the issues. We sincerely apologize for any and all inconveniences," said Neville Ray, T-Mobile's president of technology, in a tweet.

On social media and the site Downdetector, T-Mobile customers in the U.S. reported problems Monday with sending and receiving calls. The reports appear to have peaked at around 12 p.m. PT.

T-Mobile CEO Mike Sievert said in a blog post late Monday that the outage was caused by an "IP traffic related issue that has created significant capacity issues in the network core."

5. -- United Airlines Could Bar Passengers Who Don't Wear Masks

United Airlines  (UAL) - Get Report and other U.S. carriers said Monday they will strictly enforce that passengers wear masks and could bar those who refuse to wear a face covering during the coronavirus pandemic.

"While the overwhelming majority of passengers are complying with United's mandatory policy, starting on June 18, any passenger that does not comply when onboard a United flight will be placed on an internal travel restriction list," United said in a statement on its website. "Customers on this list will lose their travel privileges on United for a duration of time to be determined pending a comprehensive incident review."