5 things to know before the stock market opens Thursday, July 28

A trader works on the floor of the New York Stock Exchange (NYSE) following a Fed rate announcement, in New York City, July 27, 2022.

Brendan McDermid | Reuters

Here are the most important news items that investors need to start their trading day:

1. Stock futures look soft

US equities markets were set for a weak open Thursday following Wednesday’s broad rally. Investors are chewing on the latest round of earnings, which included Facebook parent Meta on Wednesday afternoon and NBCUniversal parent Comcast on Thursday morning. The Federal Reserve on Wednesday decided to hike rates by three-quarters of a point, in line with expectations, to battle a four-decade-high surge in inflation. Fed Chair Jerome Powell also indicated that the central bank could slow the pace of its rate hikes.

2. GDP and recession vibes

Federal Reserve Board Chairman Jerome Powell speaks during a news conference following a two-day meeting of the Federal Open Market Committee (FOMC) in Washington, July 27, 2022.

Elizabeth Frantz | Reuters

3. JetBlue gets its way

LaGuardia International Airport Terminal A for JetBlue and Spirit Airlines in New York.

Leslie Josephs | CNBC

It didn’t take long for things to fall into place for JetBlue after Spirit scuttled its deal with fellow low-cost airline Frontier. On Thursday morning, Spirit and JetBlue said they reached a deal. If the acquisition is finalized, the combination of JetBlue and Spirit would create the fifth-largest carrier in the United States. But the agreement faces significant regulatory hurdles, as the Biden administration pushes a hard line on mergers and acquisitions. CNBC’s airlines reporter Leslie Josephs breaks it down here.

4. Reality bites Meta

Facebook parent Meta reported earnings after the bell Wednesday, and they weren’t pretty. Financial results missed expectations pretty much across the board. Its metaverse and virtual reality unit suffered a fat $2.8 billion loss in the second quarter, and it’s expected to post even lower revenue in the third. The bigger immediate concern, though, is advertising revenue. And just like social media rivals Snap and Twitter, Meta, which also owns Instagram, said a slowdown in the economy is weighing on the ad business. “It’s always hard to predict how deep or how long these cycles will be, but I’d say that the situation seems worse than it did a quarter ago,” CEO Mark Zuckerberg told analysts in a call.

5. Manchin and Schumer actually reach a deal

US Senator Joe Manchin (D-WV) walks to the Senate floor at the US Capitol in Washington, June 7, 2022.

Jonathan Ernst | Reuters

Washington is notoriously slow to get things done, especially when Congress is involved. But sometimes there are surprises, too, like the out-of-nowhere deal Wednesday evening between Senate Majority Leader Chuck Schumer, DN.Y., and conservative West Virginia Democratic Sen. Joe Manchin. Just weeks ago, Manchin had balked at a reconciliation package due to his concerns over inflation. The new measure, which is designed to pass the Senate with a simple majority, includes provisions for health care and climate change, as well as reduction (including a minimum corporate tax). CNBC’s Emma Newburger explains the climate provisions in the bill here.

– CNBC’s Samantha Subin, Carmen Reinicke, Patti Domm, Leslie Josephs, Emma Newburger, Jonathan Vanian, Kevin Breuninger and Jordan Novet contributed to this report.

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