U.S. stock futures moved lower ahead of the open Thursday as investors braced for the start of tech earnings, economic data, and more Fedspeak.
Futures tied to the S&P 500 (^GSPC) were down 0.8%, while futures on the Dow Jones Industrial Average (^DJI) were lower by 0.7%. Contracts on the technology-heavy Nasdaq Composite (^IXIC) declined by roughly 0.8%.
Bond prices ticked up. The yield on the benchmark 10-year U.S. Treasury note fell to 3.368% from 3.374% Wednesday. The dollar index traded lower Thursday morning.
Stocks plummeted Wednesday after new government data showed a slowdown in consumer spending activity, while a reading on wholesale price inflation showed signs that price pressures are easing in the economy. The S&P 500 had its worst day on Wednesday since mid-December, failing to hold the 200-day moving average, according to the US Market Intelligence team at JP Morgan.
Wall Street will be navigating another round of data, as well as remarks on Thursday from Vice Chair Lael Brainard, Bank of New York President John Williams, and Bank of Boston President Susan Collins. All three Fed speakers will be attending different events before the Fed’s next monetary policy meeting, which starts Jan. 31.
On Wednesday, other Fed officials called for more interest rate hikes. St. Louis Fed President James Bullard said policymakers should move interest rates above 5% “as quickly as we can” before pausing the current hiking cycle.
Investors are starting to enter what’s likely a challenging fourth-quarter earnings season, with analysts downgrading their forecasts for earnings growth. According to the data from FactSet Research – the consensus for earnings drop is 3.9%, which would mark the first year-over-year earnings decline reported by the index since 2020 if realized.
DataTrek’s Nicholas Colas notes that the power of corporate earnings remains a question mark. Fourth-quarter earnings should provide some insight, but commentary from management on this year’s fundamentals will be more important. The problem, in Colas’ opinion, is that no CEO has an incentive to be upbeat right now.
Netflix (NFLX) is set to take center stage as it reports earnings on Thursday after the market closes, kicking off a two-week period during which most of the market’s biggest tech companies will report their quarterly results.
The streaming giant’s results will be closely watched, with this quarterly update giving a closer look at the company’s subscriber momentum in the final period of last year and any color on its advertising-supported service tier. Additionally, the company could provide potential updates on its planned crackdown on password sharing.
In market specific moves, shares of Procter & Gamble (PG) were down 2% in premarket trading after the company raised its full-year sales forecast on the back of price increases to cover transportation, commodity, labor costs, and the impact of a strong U.S. dollar hitting its overseas revenue.
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Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter @daniromerotv
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