Stock futures bounce as investors assess start of new quarter, bond market recession indicator

Stock futures bounce as investors assess start of new quarter, bond market recession indicator

Stock futures rose early Thursday as investors assessed a new quarter of buying and selling and a hard bond market recession indicator.

Investors had been additionally awaiting the official jobs report for March, which the Labor Division will launch at 8:30 a.m. ET on Friday.

Dow futures gained 65 factors, or 0.2%. S&P 500 futures added 0.2% and Nasdaq 100 futures rose 0.2% to kick off the primary buying and selling session of the second quarter.

The Dow Jones Industrial Common slumped on Thursday to shut out the primary adverse quarter for shares in two years, with losses accelerating within the closing hour of buying and selling. The Dow dropped 550.46 factors, or 1.56%, to 34,678.35. The S&P 500 slid 1.57% to 4,530.41, and the Nasdaq Composite was down 1.54% to 14,220.52.

All three main averages posted their worst quarter since March 2020. The Dow and S&P 500 declined 4.6% and 4.9% respectively in the course of the interval, and the Nasdaq dropped greater than 9%. Shares did stage a late-quarter comeback in March nevertheless after sharp declines from rising rates of interest and inflation marked the primary half of the yr.

Shares for now shook off a recession sign from the bond market that was triggered after the closing bell Thursday. The two-year and 10-year Treasury yields inverted for the primary time since 2019. For some investors, it is a sign that the economic system is headed for a attainable recession, although the inverted yield curve doesn’t predict precisely when it is going to occur and historical past reveals it may very well be greater than a yr away or longer.

“I think everybody needs to acknowledge the fact that we are obviously going to be moving into a slower economic environment,” Shannon Saccocia, chief funding officer at Boston Non-public Wealth, advised CNBC’s “Closing Bell.”

“You need to get earnings growth from somewhere, and if it’s not going to be a secular tailwind, like fiscal spend and monetary policy looseness, then you have to look for growth elsewhere. I think we’re going to see some real nuance in trading over the course of the next three months or so as people look for that growth against this more challenging economic backdrop.”

A robust jobs report Friday may give the Fed extra confidence to maintain its aggressive rate-hiking plan in place this yr to stifle inflation with out concern of slowing the economic system an excessive amount of. Economists count on that about 490,000 jobs had been added in March, in accordance with the consensus estimate from Dow Jones, following a 678,000 payrolls addition in February. The unemployment fee is predicted to fall to three.7% from 3.8%, in accordance with Dow Jones.

GameStop rallied greater than 10% in prolonged buying and selling after the online game retailer and meme inventory introduced its intentions for a inventory break up.

Vitality costs declined on Thursday after the White Home stated it is going to launch an unprecedented quantity of oil from the Strategic Petroleum Reserve. As much as 1 million barrels of oil per day might be launched for the subsequent six months.

Different key indicators to be careful for embody the ISM manufacturing index and the development spending report, each of which might be launched at 10 a.m. ET on Friday.

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