Benzinga - by Shanthi Rexaline, Benzinga Editor.
Friday’s trading signals optimism as markets rebound from a bearish week, spurred by the Federal Reserve‘s hawkish stance. Bargain hunters, particularly in the tech sector, could bolster select stocks. Investors will monitor Fed speeches, manufacturing data, and rising bond yields for further cues.
Cues From Thursday’s Trading
Thursday’s trading saw rising Treasury yields dampen risk appetite, pushing major indices lower for the third consecutive session.
Indices opened lower, moved sideways until late afternoon, and then experienced further selling. Jobless claims dropped significantly, showcasing labor market strength. However, the Philadelphia Federal Reserve reported a contraction in September manufacturing activity, and the Conference Board’s leading economic index matched expectations with a 0.4% month-over-month decline.
The Nasdaq Composite and Russell 2,000 Index hit early June closing lows, while the Dow Industrials reached a July 10 closing low, and the S&P 500 settled at a three-month low.
The market downturn affected various sectors, with consumer discretionary, material, and real estate stocks taking significant hits.
| Index | Performance (+/-) | Value |
| Nasdaq Composite | -1.82% | 13,223.99 |
| S&P 500 Index | -1.64% | 4,330.00 |
| Dow Industrials | -1.08% | 34,070.42 |
| Russell 2000 | -1.56% | 1,781.83 |
Analyst Color:
Amid the gloom in the market, Carson Group analyst Ryan Detrick pointed to one encouraging data point. The last three times the S&P 500 Index was down at least 1% each in August and September, October was up 8% in 2022 and up 8.3% in 2015 and 10.8% in 2011, the analyst said.
“Higher 9 of the past 10 times going back to the late ’50s. As bad as things feel, don’t lose faith just yet,” he said.
Futures Today
Futures Performance On Friday
| Futures | Performance (+/-) |
| Nasdaq 100 | +0.47% |
| S&P 500 | +0.27% |
| Dow | +0.12% |
| R2K | +0.22% |
In premarket trading on Friday, the SPDR S&P 500 ETF Trust (NYSE:SPY) rose 0.28% to $432.58 and the Invesco QQQ ETF (NASDAQ:QQQ) gained 0.50% to $359.65, according to Benzinga Pro data.
Upcoming Economic Data:
Federal Reserve Governor Lisa Cook is scheduled to speak at 8:50 a.m. EDT.
The S&P Global will release the flash U.S. manufacturing and services purchasing managers’ indices for September at 9:45 a.m. EDT. Economists, on average, expect the flash readings to come in at 48 and 50.6, respectively, compared to 47.9 and 50.5 in August.
Minneapolis Fed President Neel Kashkari, a member of the Federal Open Market Committee, and San Francisco Fed President Mary Daly are scheduled to speak at 1 p.m. EDT.
Stocks In Focus:
- Activision Blizzard, Inc. (NASDAQ:ATVI) stock rose over 1.70% in premarket after the U.K. antitrust agency said a newly structured deal substantially addresses its concern regarding cloud gaming, potentially paving the way for the completion of the videogame software publisher’s pending acquisition by Microsoft Corp. (NASDAQ:MSFT).
- United States Steel Corporation (NYSE:X) gained about 1.50% after reports said Canadian steelmaker Stelco is considering a bid for the former.
- Alibaba Group Holding Ltd. (NYSE:BABA) rallied over 4% and Peer JD.com, Inc. (NASDAQ:JD) climbed about 3.70% after a Bloomberg report said China was considering relaxing rules that cap foreign ownership in domestic publicly traded companies.
- Beaten-down tech stocks such as Palantir Technologies Inc. (NYSE:PLTR), Amazon, Inc. (NASDAQ:AMZN), and Nvidia Corp. (NASDAQ:NVDA) were seen rebounding in premarket trading.
Crude oil futures climbed 1.16% to $90.67 in early European session on Friday following Thursday's nearly 0.72% retreat.
The benchmark 10-year Treasury note remained unchanged at 4.48% after topping 4.5% level earlier in the session.
The Asian market traded in a lackluster manner on Friday, although the Hong Kong and Chinese markets advanced strongly on reports of Chinese easing norms about foreign ownership in domestic companies. European stocks traded mixed in late-morning trading on Friday.
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