Stock futures stumble after online inflation print

U.S. stocks fell at the open on Thursday as investors dissected the latest batch of economic data and braced for more Fedspeak and the start of the tech giants’ earnings season.

The tech-heavy S&P 500 (^GSPC), Dow Jones Industrial Average (^DJI) and Nasdaq Composite (^IXIC) were all down about 0.5% at the start of trading.

Bond prices rose. The yield on the benchmark 10-year US Treasury fell to 3.368% from 3.374% on Wednesday. The dollar index was trading lower on Thursday morning.

Shares fell on Wednesday after new government data showed a slowdown in consumer spending, 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 maintain the 200-day moving average, according to JP Morgan’s US Market Intelligence team.

Wall Street will navigate another round of data, along with remarks Thursday from Vice Chairman Lael Brainard, Bank of New York President John Williams and Bank of Boston President Susan Collins. The three Fed speakers will attend different events ahead of the Fed’s next monetary policy meeting, which begins on January 1. 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 possible” before pausing the current hike cycle.

On the economic data front, new home construction in the United States continued to fall in December, the fourth consecutive monthly decline, ending a disappointing year for the industry.

Residential housing starts fell 1.4% last month to 1,382 million at an annualized rate, according to government data released Thursday. Construction of single-family homes jumped to an annualized rate of 909,000. Economists polled by Bloomberg called for a pace of 1.36 million total residential starts in December.

Building applications, an indicator of future construction, fell 1.6% to an annualized 1.33 million units. Permits for single-family homes fell 6.5%.

Initial jobless claims fell to 190,000 from 205,000 the previous week. Claims are expected to reach 214,000, according to Bloomberg estimates.

Meanwhile, the Philadelphia Fed Manufacturing Index improved slightly in January to -8.9 from -13.8 in December. This reading is better than the -10.3 forecast.

Investors are starting to head into what is expected to be a tough fourth-quarter earnings season as analysts lower their earnings growth forecasts. According to data from FactSet Research, the consensus for a decline in earnings is 3.9%, which would mark the first year-over-year decline in earnings reported by the index since 2020 if it materializes.

DataTrek’s Nicholas Colas notes that the power of corporate earnings remains a question mark. Fourth-quarter earnings should provide insight, but management commentary on this year’s fundamentals will be more important. The problem, according to Colas, is that no CEO has any reason to be optimistic right now.

Netflix (NFLX) is set to take center stage as it reports earnings on Thursday after the market closed, kicking off a two-week period in which most of the world’s biggest tech companies market will publish their quarterly results.

The streaming giant’s results will be closely watched, with this quarterly update giving a deeper insight into the company’s subscriber dynamics over the latter part of last year and any color on its funded service level. by advertising. Additionally, the company could provide potential updates on its planned crackdown on password sharing.

The Netflix logo is pictured at the 2022 Paris Auto Show in Paris, France October 17, 2022. REUTERS/Stephane Mahe

In market-specific moves, shares of Alcoa (AA) fell on Thursday after the U.S.-based aluminum producer announced lower prices for aluminum products through the end of 2022.

Shares of Procter & Gamble (PG) fell 1% on Thursday morning after the company raised its full-year sales forecast due to price increases to cover transport, raw materials, labor costs labor and the impact of a strong US dollar on its overseas revenues. .

In commodity markets, West Texas Intermediate (WTI) rose almost 1% to $80 a barrel. Meanwhile, gas prices are up 5.33% since the end of 2022, according to AAA data.

Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter @daniromerotv

Click here for the latest stock market news and in-depth analysis, including events moving stocks

Read the latest financial and business news from Yahoo Finance

Download the Yahoo Finance app to Apple or android

Follow Yahoo Finance on Twitter, Facebook, instagram, Flipboard, LinkedInand Youtube

Leave a Comment

Your email address will not be published. Required fields are marked *