Here are five things you must know for Wednesday, March 17:
1. -- Stock Futures Fall as Wall Street Awaits the Fed
Stock futures were mostly lower as investors awaited the Federal Reserve's assessment Wednesday of a U.S. economy slowly recovering from the coronavirus pandemic.
Contracts linked to the Dow Jones Industrial Average rose 10 points, S&P 500 futures dropped 12 points and futures on the tech-heavy Nasdaq declined a sharp 130 points.
The central bank will announce a decision on interest rates later Wednesday, followed by a press conference from Federal Reserve Chairman Jerome Powell, who is expected by economists to indicate the Fed will tolerate higher inflation to get the U.S. back to full employment.
Bond yields have pushed higher recently on rising inflation expectations and have sparked a rotation to value stocks from high-growth equities, particularly technology shares. The 10-year Treasury yield rose to 1.667% early Wednesday, a 13-month high.
The Fed previously has said it won't raise rates until 2023 at the earliest since it expects inflation will remain at or below the central bank's 2% target through that year.
"Has the Fed started thinking about thinking about raising short-term interest rates?" asked Ryan Detrick, chief market strategist for LPL Financial.
"Back in June 2020, Chairman Powell famously quipped, 'We’re not even thinking about thinking about raising rates' in an effort to reassure markets that the low interest rate environment was here for some time. While we don’t expect the Fed to announce plans to raise rates anytime soon, the market has started pricing in an earlier liftoff (early 2023) than the Fed has communicated.
"It will be interesting to see if the Fed pushes back against these market expectations," Detrick added.
Stocks ended mostly lower Tuesday and the S&P 500's winning streak of five sessions came to an end as investors awaited the Fed's projections on the U.S. economy. The Dow ended a seven-day streak of gains.
2. -- Wednesday's Calendar: Federal Reserve Meeting and Williams-Sonoma Earnings
The U.S. economic calendar for Wednesday includes an announcement on interest rates from the Federal Reserve at 2 p.m. ET and a press conference from Federal Reserve Chairman Jerome Powell at 2:30 p.m.
The calendar also includes Housing Starts and Permits for February at 8:30 a.m. and Oil Inventories for the week ended March 12 at 10:30 a.m.
3. -- Plug Power Plunges on Accounting Errors
The errors included "book value of right of use assets and related finance obligations," loss accruals for service contracts, impairment of certain long-lived assets and "classification of certain costs, resulting in a decrease in research and development expense."
“The accounting related to the restatement is complex and technical and involves significant judgments in how to apply U.S. GAAP, given the innovative nature of the company’s business and its leading position in a new and rapidly developing industry,” Plug Power said in a statement.
As a result of the corrections, Plug Power delayed the filing of its annual report but said it would do so “as soon as possible.”
Analysts at Cowen said shares of Plug Power look “oversold” on the news and the decline offers a “unique buying opportunity."
The stock dropped 22.52% to $33.07 in premarket trading Wednesday.
4. -- Uber to Treat U.K. Drivers as Full-Time Employees
Uber Technologies (UBER) will begin treating its drivers in the United Kingdom as full-time employees entitled to a minimum wage, pension benefits and other rights.
The move came after Uber lost a court case last month challenging the requirements.
According to a statement issued by the ride-hailing app, U.K. drivers will receive an earnings guarantee, holiday pay and pensions.
The company, which has more than 70,000 drivers in the U.K., said the changes go into effect Wednesday.
Drivers will receive at least £8.72 ($12) per hour. Uber described it as an “earnings floor, not an earnings ceiling.”
Uber didn’t disclose what it would cost to reclassify the drivers but indicated it doesn’t expect a change to its earnings forecast for the quarter or the year.
Uber shares fell 1.26% to $58.11 in premarket trading Wednesday.
5. -- St. Patrick's Day - Fast Facts
St. Patrick’s Day is celebrated around the world in observance of the death of Saint Patrick, the patron saint of Ireland, who was credited for bringing Christianity to the country.
Saint Patrick wasn't Irish - he was British.
Saint Patrick has nothing to do with driving snakes out of Ireland. The reptiles have never existed there - Ireland is too cold for them.
The first St. Patrick’s Day parade in America was held in New York in 1766. This year the parade largely will be virtual. A few dozen people are expected to march early Wednesday to keep the tradition alive, according to a spokesperson for Mayor Bill de Blasio.
The parade was postponed last year - the first time that has happened - over concerns about the spread of the coronavirus.