5 things to know before the stock market opens Wednesday, November 2

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

The Federal Reserve is expected to wrap up its two-day meeting Wednesday afternoon with another three-quarter-point rate hike. Investors will be locked in to hear what the Fed and Chairman Jerome Powell will say about their next course of action with the job market and the economy still running hot. “We think they do open the door to a step down in rate hikes beginning in December,” said Michael Gapen, Bank of America’s chief U.S. economist. Other market watchers, however, expect Powell will avoid trying to create too much excitement for a slowdown in rate hikes. Read live market updates here.

Just about all of Amazon‘s pandemic gains are gone. The e-commerce and cloud computing giant suffered its fifth straight losing day in markets Tuesday, falling to its lowest point since April 2020. It also fell below $1 trillion in market value. The stock is down nearly 42% so far this year, as the tech titan tries to come to grips with the fact that consumers aren’t spending as much money on stuff as they did during the earlier days of the pandemic. Instead, people are fighting inflation by focusing more on essentials, such as groceries, while shaking off more than two years of Covid restrictions to eat out, party and travel more. These days, the rush from seeing an Amazon package left at your door just isn’t as exciting as a jaunt to Europe or some burgers and beer with your friends.

Shipping giant Maersk on Wednesday warned of gloomy times ahead for global trade, even as it reported record profit stemming from high rates charged by its ocean business. “With the war in Ukraine, an energy crisis in Europe, high inflation, and a looming global recession there are plenty of dark clouds on the horizon,” Søren Skou, the CEO of the Danish company, said in a statement. He said all of that weighs on consumers’ ability to spend, leading to softer demand for shipping services. In turn, the company believes it has seen a peak in earnings from its ocean business and that things are slowing down in the fourth quarter.

Russia said Wednesday it agreed to rejoin a deal with Ukraine that would keep grain exports flowing. The Kremlin suspended its involvement in the agreement over the weekend, citing attacks on its ships in the Black Sea. The pause triggered a spike in grain prices. Ukraine, in turn, rejected that claim as a false pretext. However, on Wednesday, Russia said it had gotten guarantees from Ukraine that it wouldn’t conduct military operations against Russian forces using the Black Sea corridor. Read live war updates here.

A slight decline in rates last week didn’t spark much new mortgage demand. Indeed, overall demand fell as buyers largely remained on the sidelines with rates hovering above 7% and prices remaining high despite a sudden, recent cooling. Demand for refinance mortgages did grow, albeit slightly, according to the Mortgage Bankers Association, but not enough to move the needle. Homebuilders have already said housing is in a recession, and now they’re warning that rougher times are coming in the new year.

– CNBC’s Patti Domm, Annie Palmer, Elliot Smith, Holly Ellyatt and Diana Olick contributed to this report.

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