*
Virgin Orbit soars on nearing $200 mln deal
*
GameStop jumps after surprise Q4 profit
*
First Republic Bank shares reverse gains premarket
*
Futures mixed: Dow up 0.02%, S&P down 0.08%, Nasdaq down 0.22%
(Updates prices, adds comments)
By Amruta Khandekar and Shubham Batra
March 22 (Reuters) - Wall Street's main indexes were
headed for a subdued open on Wednesday, ahead of the outcome of
the Federal Reserve's rate-setting meeting in which the central
bank will seek to balance inflation and banking sector concerns.
Traders have halved the size of the expected interest rate
hike to 25 basis points following troubles in the banking
sector, with some pointing to the Fed's aggressive monetary
tightening over the past year as one of the reasons for the
crisis.
Analysts have said a pause was unlikely as it would indicate
the banking turmoil, sparked by the failure of two U.S. regional
lenders, had rattled the central bank.
The U.S. central bank's two-day policy meeting will end at 2
p.m. ET (1800 GMT), with investors keenly awaiting Fed Chair
Jerome Powell's conference at 2:30 p.m. ET to gauge the central
bank’s rate-hike trajectory.
"In order to solve the banking problem, you really have to
go back down to very low interest rates and I don't think that's
going to happen," said Paul Nolte, senior wealth adviser and
market strategist at Murphy & Sylvest.
"What you're going to wind up with is a Fed that will
probably be a little bit more focused on inflation and they're
going to deal with the banking situation as it comes up."
Wall Street's main indexes notched gains in the past two
straight sessions, after the rescue of Credit Suisse as
well as measures by central banks to boost liquidity helped
soothe some worries about risks to other banks.
However, a scramble by troubled regional U.S. lender First
Republic Bank to secure a capital infusion has kept
alive some worries about the banking sector.
Shares of First Republic reversed course to trade 5.0% lower
premarket, with a Bloomberg News report on Tuesday stating the
bank's rescue could rely on backing from the U.S. government to
facilitate a deal.
Shares of its peers PacWest Bancorp and Western
Alliance Bancorp also fell 2.1% and 1.1%, respectively,
amid choppy trading.
U.S. Treasury yields reversed course to march higher, with the yield on the two-year note, which best reflects interest rate expectations, last at 4.24%. At 8:20 a.m. ET, Dow e-minis were up 8 points, or 0.02%, S&P 500 e-minis were down 3.25 points, or 0.08%, and Nasdaq 100 e-minis were down 28 points, or 0.22%. Among other stocks, Virgin Orbit Holdings Inc soared 62.7% after Reuters reported the company is near a deal for a $200 million investment from Texas-based venture capital investor Matthew Brown.
GameStop Corp jumped 47.9% after the company posted a surprise profit for the fourth quarter, helped by lower costs and job cuts. Nike Inc fell 1.8% in premarket trade after the sports apparel maker raised its full-year revenue outlook on Tuesday but warned of margin pressures. (Reporting by Amruta Khandekar and Shubham Batra in Bengaluru; Editing by Nivedita Bhattacharjee and Vinay Dwivedi)
