Nasdaq futures fell on Thursday, promising a further slide into correction territory, as stocks continued to sink under the weight of disappointing Big Tech earnings reports and rising bond yields.
Contracts on the Nasdaq 100 (^NDX) dropped almost 0.9%, signaling tech stocks are still under pressure after booking their worst single-day performance in eight months on Wednesday.
Meanwhile, S&P 500 (^GSPC) futures were down 0.5% in the wake of the benchmark’s lowest close since May. Dow Jones Industrial Average (^DJI) futures slipped 0.2%, echoing the previous day’s modest losses.
Earnings are in the drivers seat for stocks, as investors punish megacaps whose third-quarter reports turned out more downbeat than hoped. Concerns are growing that valuations are too high in a world of surging Treasury yields, as the benchmark 10-year yield (^TNX) climbed back near 5% on Thursday.
While Meta’s (META) earnings beat on the top and bottom lines, its shares reversed initial gains after the Facebook parent warned geopolitical unrest could drag on its ad business. The flow of earnings resumes Thursday, with Amazon (AMZN), Intel (INTC), Ford (F) and Chipotle (CMG) the highlights on the docket.
Overall, Big Tech results are seen as not providing a clear story at a time when the stock market needs one, which could mean they won’t be enough to drive a rally as in previous earnings seasons.
“There’s real dispersion,” BlackRock’s Global CIO Rick Rieder said, noting Microsoft and Alphabet earnings. “We’re getting a series of conflicting signs around market. That’s why markets are so jumpy, so uncertain.”
Some direction could come with the release of Thursday’s third-quarter GDP reading. A first estimate, it’s expected to be the high-water mark for economic growth in 2023 after a string of data showing resilience.
KStock futures point to a return to sell-off
Wall Street stocks were on track Thursday to add to the previous day’s sharp losses, as investors looked ahead to fresh earnings releases.
Futures on the Dow Jones Industrial Average (^DJI) were down 0.41%, or 136 points, while S&P 500 (^GSPC) futures shed 0.67%. Contracts on the tech-heavy Nasdaq 100 (^NDX) were 0.95% lower.
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