5 things to know before the stock market opens Tuesday

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, September 26, 2022.

Brendan McDermid | Reuters

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

1. Stocks try to shake it off, again

U.S. stock futures were headed for a higher open Tuesday following yet another rout the day before. Stocks are on a five-day losing streak, and the blue-chip Dow Jones industrial average is in a bear market, having fallen more than 20% from its record high. The Cboe Volatility Index, also known as the VIX or the “fear gauge,” on Monday hit its highest level since the middle of June, the last time markets were in the pits this year. In Fed world, where policy makers are keen to squelch price increases with rate hikes, Cleveland Fed President Loretta Mester said inflation was “unacceptably high.” Chicago Fed President Charles Evans, meanwhile, said he’s a little nervous about how fast and boldly the Fed is moving, but noted he’s “cautiously optimistic” the U.S. can avoid a recession.

2. What’s going on in the UK?

British Prime Minister Liz Truss, who took office in September, has announced a sweeping program of economic reforms.

David Dee Delgado | Reuters

It’s a mess, for one, and it may well become something worse. New UK Prime Minister Liz Truss’s government rolled out a debt-funded “trickle down” economic package that features historically massive tax cuts. The Bank of England, meanwhile, has been reluctant to raise rates to battle surging inflation, even as it plans to scale back its balance sheet. Lenders are pulling some mortgage deals, as well. The economic plan, which became known Friday, triggered a steep market selloff in the UK, while the pound tanked against the dollar. Analysts and experts have said there’s no evidence the package would boost the economy. Some have warned of a potential crisis. Former U.S. Treasury Secretary Larry Summers, who warned that inflation would surge during recent stimulus pushes, was especially harsh. “A currency crisis in a reserve currency could well have global consequences. I am surprised that we have heard nothing from the IMF,” he said.

3. Suspicious votes in Ukraine

Drone footage shows long queues of vehicles on the way to exit Russia on its border with Georgia, in Verkhny Lars, Russia, September 26, 2022, in this still image obtained from a video.

The Insider | via Reuters

Tuesday is the last day of voting in Russian-occupied areas of Ukraine, where people are reportedly being coerced and forced to vote to join Russia. Western officials and political analysts have slammed the votes as illegitimate as the Russian government aims to say it has annexed more of its former Soviet neighbor. Elsewhere, Russian President Vladimir Putin’s push to call up 300,000 reservists is being met with resistance. Men are fleeing, protests have erupted, and a man was arrested for shooting up a draft office. Read more updates about the war in Ukraine here.

4. Biden’s bid to boost competition

U.S. President Joe Biden, seated between Defense Secretary Lloyd Austin and Secretary of Health and Human Services (HHS) Xavier Becerra, delivers remarks at a meeting of the White House Competition Council in the State Dining Room of the White House in Washington, September 26, 2022.

Jonathan Ernst | Reuters