- The Federal Reserve has signaled that it will cut interest rates just once this year.
- Broadcom announced a 10-for-1 stock split.
- Sony Pictures is acquiring the Alamo Drafthouse movie theater chain.
Here are five important things investors should know before starting the trading day.
Markets were mostly higher as the Fed kept interest rates unchanged and economic reports were cooler than expected. While interest rates remained unchanged, investors were optimistic after the Fed said it had made “moderate progress” toward its 2% inflation target. The S&P 500 rose 0.85% on Wednesday, closing above 5,400 for the first time. The Nasdaq Composite rose 1.53%, hitting a record high. The Dow Jones Industrial Average fell 0.09%, marking an unusual day for markets. Follow Live Market Updates
Federal Reserve Chairman Jerome Powell announces the holding of interest rates during a press conference at the Federal Reserve Bank of America’s William McChesney Martinbuilding on June 12, 2024 in Washington, DC.
Kevin Dietsch | Getty Images
Wednesday was a two-part day for economic news. The Federal Reserve signaled it expects one interest rate cut by the end of the year, fewer than the three cuts the Federal Open Market Committee signaled in March. The central bank also left its key interest rate unchanged at a range of 5.25% to 5.5%. Meanwhile, the Consumer Price Index, released early Wednesday, showed no increase in May but was up 3.3% year-over-year. Federal Reserve Chairman Jerome Powell noted at a press conference that the CPI report showed progress, but added that “we do not believe we have enough confidence at this point to begin easing policy.”
Omar Marquez | LightRocket | Getty Images
Broadcom on Wednesday beat second-quarter profit expectations and raised its full-year revenue outlook. The company also announced a 10-for-1 stock split and plans to begin split-adjusted trading on July 15. As a result, its shares rose 13% in premarket trading on Thursday. The company is benefiting from the artificial intelligence boom, noting that $3.1 billion of its quarterly sales came from revenue from AI products.
Inside the Alamo Drafthouse Cinema theater.
Alamo Drafthouse
Lights, cameras, screens. It’s the first time in more than 75 years that a major Hollywood studio has owned a movie theater chain. Sony Pictures announced on Wednesday that it has acquired the dine-in cinema chain Alamo Drafthouse. Studios were prohibited from owning movie theater chains from 1948 to 2020, but Sony is the first company to invest in a film company since the ban was lifted. Alamo Drafthouse is the seventh largest movie theater chain in North America. The company filed for Chapter 11 bankruptcy protection in 2021 after the pandemic and was rescued by a private equity firm.
Keith Gill (aka Roaring Kitty) will be hosting a YouTube livestream on June 7, 2024.
Source: Roaring Kitty | YouTube
Did the game stop? Selling of GameStop shares intensified in afternoon trading on Wednesday. This coincided with a surge in trading volume for call options held by meme stock guru Keith Gill (also known on social media as “Roaring Kitty” and “Deep——-Value”). It’s unclear if Gill is behind it, but he last disclosed his positions on Monday, and there was speculation that he might sell early. A whopping 93,266 GameStop call options with precise strike prices and expiration dates traded on the day. Many suspect that Gill, who has said he won’t work with institutional investors, doesn’t have the funds to exercise his options, which expire on June 21. Meanwhile, GameStop’s annual meeting is scheduled for Thursday morning.
—CNBC’s Lisa Kaylai Han, Sarah Ming, Jeff Cox, Darla Mercado, Kiff Leswing, Sarah Whitten and Yun Lee contributed to this report.
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