Tonight's Highlights | Market Cautious Ahead of Fed Rate Decision; U.S. Futures Ease as Oil Surges Nearly 6%

U.S. stock index futures weakened on Wednesday as cautious sentiment prevailed across global markets ahead of the Federal Reserve's rate decision, with Chair Kevin Warsh scheduled to hold a press conference 30 minutes following the announcement.

 

According to the CME FedWatch Tool, money markets are heavily pricing in a rate pause, with the probability of a 25-basis-point hike sitting under 30%.

 

However, with Warsh refraining from giving explicit forward guidance, analysts view this meeting's outcome as exceptionally difficult to predict.

 

"We remain of the view that the market is overly focused on inflation risks and underestimating the potential economic fallout of further monetary tightening," said Julia Hermann, Global Market Strategist at New York Life Investment Management. "Should the Fed deliver a hawkish message, the current rally—concentrated in a handful of mega-caps—could face sharper pressure than the broader tape."

 

Brent crude futures surged nearly 6% to trade just below $87 per barrel.

 

The rally followed a statement from U.S. Central Command on social media that the Islamic Revolutionary Guard Corps (IRGC) launched multiple ballistic missiles in an attempted surprise attack against U.S. forces in the Middle East, all of which were successfully intercepted.

 

U.S. President Donald Trump stated that the military would respond forcefully against Iran following the Jordan attack.

 

In cash equities, the Philadelphia Semiconductor Index slid in pre-market trading.

 

Chip stocks have fallen for four consecutive sessions, shedding nearly 7% this week amid deepening market anxiety surrounding capital expenditure returns on massive artificial intelligence investments.

 

SK Hynix fell nearly 2% in U.S. pre-market action after closing 9.6% lower in Seoul on Wednesday, where it intraday plunged as much as 15%.

 

Procter & Gamble fell over 2% pre-market following lower-than-expected quarterly revenue, while Ford Motor rose 5% after topping profit estimates and raising its full-year 2026 outlook. Credit card giant Visa slipped around 2% as its forward guidance disappointed investors.

 

Appetite for the AI narrative and hyperscaler CapEx will face a major test after the closing bell, with Meta and Microsoft slated to report quarterly results.

Pre-Market Earnings Summary

Procter & Gamble Q4 Net Sales Hit $21.2 Billion, Up 2%

Procter & Gamble reported financial results for its fourth quarter and full year ending June 30, 2026. Fourth-quarter net sales rose 2% year-over-year to $21.2 billion. Diluted EPS dropped 15% to $1.26 due to cost pressures and non-core adjustments, while core EPS declined 3% to $1.43.

 

For full-year FY2026, P&G generated $87.0 billion in net sales (up 3%), with diluted EPS up 2% to $6.62 and core EPS rising 1% to $6.89. For FY2027, P&G projects organic sales growth of 1% to 3% and core EPS between $6.89 and $7.11.

 

UBS Q2 Revenue Tops Estimates at $13.7 Billion, Up 13%

UBS reported Q2 revenue of $13.70 billion (up 13% YoY), beating the consensus estimate of $13.26 billion. Net profit reached $2.80 billion (up 17% YoY), topping the $2.47 billion expected. UBS also launched a new $3.0 billion share buyback program, targeting completion by the end of Q2 2027.

 

BASF Group Q2 Sales Surge 16.4% to €17.2 Billion

BASF Group disclosed Q2 2026 sales of €17.2 billion, up 16.4% year-over-year, driven by strong price increases (+11.5%) and volume growth (+7.3%).

 

Price increases were led by Chemicals, Surface Technologies, Materials, and Industrial Solutions. Q2 EBITDA rose to €2.0 billion from €1.3 billion a year prior.

 

Deutsche Bank Q2 Pre-Tax Profit Rises 11%; Announces €500M Buyback Plan

Deutsche Bank reported Q2 net revenue of €8.48 billion (up 8.6% YoY vs. €8.13B expected) and Investment Banking revenue of €3.19 billion (up 19% YoY vs. €2.92B expected).

 

Pre-tax profit reached €2.68 billion (up 11% YoY vs. €2.39B expected), with a CET1 ratio of 13.9%. Deutsche Bank reaffirmed its full-year 2026 revenue target of ~€33 billion and plans to launch a new €500 million share buyback in H2 following the completion of its current €1.0 billion program.

 

UMC Q2 Net Profit Reaches NT$42.26 Billion as Revenue Rises 17%

United Microelectronics Corporation (UMC) reported Q2 2026 consolidated revenue of NT$68.73 billion ($2.18B), up 17.0% YoY and 12.6% QoQ. Gross margin stood at 32.5%, operating margin at 21.8%, and net profit attributable to parent reached NT$42.26 billion ($1.34B), or NT$3.39 per share.

 

Wafer shipments rose 10.6% QoQ driven by communications and consumer electronics demand, raising utilization rates to 85%. 22/28nm revenue hit a record high, with 22nm accounting for 17.5% of Q2 sales. UMC expects Q3 wafer shipments to grow by high-single-digits and utilization rates to top 90%.

Corporate News

GlobalFoundries Secures $300 Million U.S. CHIPS Funding to Accelerate Silicon Photonics

GlobalFoundries signed a letter of intent with the U.S. Department of Commerce for $300 million in CHIPS R&D funding to accelerate next-generation silicon photonics. The capital will advance optical materials, wafer technologies, and 3D hybrid bonding to support AI and high-performance computing data centers.

 

Under a separate agreement, the Commerce Department will receive a ~1% equity stake in GlobalFoundries. Pre-market shares surged over 16% before paring gains to around 3%.

 

NextEra Energy and Brookfield Partner on $100 Billion AI Data Center Campus

NextEra Energy and Brookfield announced a joint venture to redevelop a decommissioned Cold War-era uranium enrichment site in Paducah, Kentucky, into a massive AI data center campus.

 

Representing over $100 billion in private investment, the project features 2 GW of natural gas generation, 2.6 GW of battery storage, and an 1.8 GW data center footprint managed by Brookfield. Construction is slated to begin around 2028 with completion targeted for 2031–2032.

 

BMW Plans Thousands of Job Cuts in Germany via Voluntary Buyouts

BMW Group plans to offer voluntary severance packages to thousands of employees in Germany as part of a cost-cutting initiative.

 

Global headcount will be reduced by roughly 8,000, with the majority concentrated in Germany across R&D, product planning, and corporate functions, excluding assembly line workers. The voluntary buyout scheme will launch in October and run through 2027.