5 things to know before the stock market opens Friday

FRI, JUN 24, 2022

MORNING SQUAWK

1. Wall Street heads for its first weekly advance in the past four

U.S. stock futures pointed to a higher Friday open on Wall Street, as the Dow Jones Industrial Average, the S&P 500 and the Nasdaq all tracked for their first positive week in the past four, getting support from the recent decline in bond yields.

The benchmark 10-year Treasury yield, while slightly higher Friday to around 3.1%, has been trending lower since last week's surge to 2011 highs near 3.5% after the Federal Reserve's biggest interest rate increase since 1994.
The Fed's stepped-up efforts to slow the economy to fight inflation have raised concerns about a recession. The latest indicators of U.S. economic health are out at 10 a.m. ET, with the release of May new home sales and the University of Michigan's final June consumer sentiment index.

2. Powell vows 'unconditional' measures to fight decades-high inflation

In Day 2 of his semiannual economic testimony on Capitol Hill, Fed Chairman Jerome Powell told the U.S. House of Representatives Financial Services Committee that the central bank's commitment to reining in 40-year-high inflation is "unconditional." A day earlier, on Wednesday, Powell told the U.S. Senate Banking Committee that the Fed was not trying to provoke a recession but that one was "certainly a possibility." Last week, monetary policymakers hiked rates by 75 basis points and signaled another increase of 50 to 75 basis points at their July meeting.

3. FedEx reports mixed quarter results as ground unit margin improved

FedEx shares turned lower in Friday's premarket, the morning after the delivery giant reported better-than-expected fiscal fourth-quarter profit but missed on revenue. Adjusted earnings of $6.87 per share beat estimates by a penny. Revenue grew 8% to $24.4 billion, lower than expectations of $24.56 billion. Shipment volumes declined, but that was offset by increased shipping rates and fuel surcharges. FedEx's closely watched ground unit margin improved, but it has lagged United Parcel Service, whose new CEO adopted a "better not bigger" mantra two years ago. FedEx issued upbeat guidance for fiscal 2023.

4. Zendesk surges on reports that it's nearing a deal to sell itself

Zendesk shares surged more than 50% in the premarket on reports that the customer service software vendor was close to a buyout deal with a group of private equity firms. The Wall Street Journal reported that Hellman & Friedman and Permira are among those involved. The potential buyout comes after Zendesk announced last week that it had ended efforts to sell itself. The San Francisco-based firm has been under pressure from activist investor Jana Partners. The Journal said it's unclear where Zendesk's discussions with Jana stand.

5. Bill designed to prevent gun violence is headed for House, then Biden

A bipartisan bill designed to prevent gun violence that passed the Senate on Thursday night goes to the House. Speaker Nancy Pelosi promised a vote Friday to send the most sweeping firearms measure in decades to President Joe Biden for his signature. The legislation, which seemed unimaginable a month ago, got 15 Republican votes in the Senate, including Minority Leader Mitch McConnell. The May 24 massacre at a Uvalde, Texas, elementary school galvanized both sides of the aisle to try to prevent this from happening again.

— CNBC's Peter Schacknow, Jesse Pound, Sarah Min and Tanaya Macheel as well as Reuters and The Associated Press contributed to this report.

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