5 things to know before the stock market opens on Thursday July 14

A trader works on the floor of the New York Stock Exchange (NYSE) in New York on July 13, 2022.

Brendan McDermid | Reuters

Here are the most important information investors need to start their trading day:

1. Another weak morning for stocks

Just days ago, investors toasted a winning week in the markets as stocks tried to climb out of a big hole left by the worst first half for stocks in five decades. Things took a turn for the worse this week, however, with June inflation numbers coming in higher than expected, raising concerns on Wall Street that the Fed would raise rates even more aggressively this month. . Futures were down across the board before the bell on Thursday morning as markets digested early earnings reports from big banks.

2. Yellen says inflation is “unacceptably high”

U.S. Treasury Secretary Janet Yellen testifies before a House Ways and Means Committee hearing on President Biden’s proposed U.S. budget for 2023, on Capitol Hill in Washington, June 8, 2022.

Jonathan Ernest | Reuters

Speaking of inflation, which remains at its highest level in four decades, Treasury Secretary Janet Yellen couldn’t escape the subject, even during a trip to Indonesia. She said tackling rising prices was the “top priority” in Washington and pledged to support the Fed’s efforts. The US central bank is expected to hike rates another 75 basis points this month, but some observers believe policymakers could go even higher, up to a 1% or 100 basis point hike. Yellen also weighed in on the impact of a stronger dollar on other economies: “On the one hand, it can strengthen their ability to export, which is good for their growth. On the other hand, to the extent that countries have debt, it can make those debt problems – which are already very serious – more difficult.”

3. JPMorgan and Morgan Stanley report earnings

A person enters the headquarters of JPMorgan Chase in New York, June 30, 2022.

andrew kelly | Reuters

JPMorgan Chase kicked off big bank earnings by reporting a 28% drop in profits in the second quarter as the bank built up reserves to deal with bad debts. Later, Morgan Stanley announced that its revenue fell in the second quarter, which CEO James Gorman called “a more volatile market environment than we’ve seen in some time.” Investors are looking to see how Wall Street handled volatility during the most recent period, which saw strong growth in consumer spending and employment, even as inflation continued to rise and growing signs of economic slowdown.

4. Netflix calls on Microsoft

The Netflix logo is seen on a TV remote, in this illustration taken January 20, 2022.

Dado Ruvic | Reuters

Netflix is ​​moving forward with its plan for an ad-supported tier – and it’s doing so with a surprising partner. After talking to other potential partners, including Google, parent of YouTube, and Comcast, parent of NBCUniversal, the streaming giant settled on Microsoft. The advertising effort is still in the “very early days”, with “a lot of work to do”, according to Netflix, but investors are eager to see any signs that the company is working to stem an exodus subscribers. Netflix said earlier this year that it expected to lose 2 million subscribers in the second quarter. The company is expected to release its quarterly results on Tuesday.

5. Crypto company files for bankruptcy

Bitcoin and other cryptocurrencies have fallen sharply as investors dump risky assets. A crypto credit company called Celsius is suspending withdrawals for its clients, sparking fears of contagion in the wider market.

Nurphoto | Nurphoto | Getty Images

Lender Celsius is the latest crypto firm to fall, launching the bankruptcy process this week. A month ago, the company froze customer accounts due to “extreme market conditions” as various cryptocurrencies, including bitcoin, were in the midst of a dramatic sell-off. Celsius’ move follows Voyager’s Chapter 11 bankruptcy filing last week after its exposure to Three Arrows Capital generated big losses. Three Arrows Capital is now defunct and a judge froze its remaining assets this week as it goes into liquidation.

Disclosure: Comcast owns CNBC’s parent company, NBCUniversal.

– CNBC’s Carmen Reinecke, Su-Lin Tan, Hugh Son, Jessica Bursztynsky, Kate Rooney and Paige Tortorelli contributed to this report.

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