US Market Set To End Week With Whimper As Amazon Drags Nasdaq Futures Lower; Apple, Pinterest, Oil Giants, Inflation Readings In Focus

U.S. index futures are uniformly lower on Friday, as tech stocks continue to drag the overall market.

The major U.S. averages closed Thursday’s session on a mixed note, with the S&P 500 and the Nasdaq Composite indices declining sharply, while the Dow Industrials bucked the downtrend. While earnings reports from a couple of Dow components propped up the blue-chip average, earnings also proved to be the undoing of the tech-heavy Nasdaq index.

Traders also reacted to advance third-quarter GDP report, which showed quicker-than-expected growth.

“The U.S. is not currently in recession, given the strength of the consumer sector,” Jeffrey Roach, chief economist for LPL Financial said. Excluding more volatile categories, the growth trajectory looks weak, he added.

“A deteriorating housing market and nagging inflation along with an aggressive Federal Reserve put the economy on unsure footing for 2023,” the economist said, adding that the markets have possibly priced in much of the near-term recession risks.

The next five trading days are historically the best of the year for the S&P 500 Index, said Ryan Detrick, chief market strategist at Carson Group. 

The next five trading days are the best of the year for the S&P 500.

Going back to 1950, stocks gained 1.62% on average. There isn't a single 5-day period of the year better. pic.twitter.com/7a3kJCiRrP

— Ryan Detrick, CMT (@RyanDetrick) October 28, 2022

Here’s a peek into index futures trading:

In premarket trading on Friday, the SPDR S&P 500 ETF Trust SPY fell 0.68% to $377.38 and the Invesco QQQ Trust QQQ declined 1.17% to $269.69, according to Benzinga Pro data.

On the economic front, the Bureau of Economic Analysis will release the personal income and spending report for September at 8:30 a.m. ET. Apart from the main metrics, traders may also focus on the annual rate of the core personal consumption expenditure index, which is the Fed’s preferred inflation gauge.

At 10 a.m. EDT, the National Association Of Realtors will release the pending home sales index for September. The headline index is a measure of future housing activity.

The University of Michigan will release the final consumer sentiment index for October, also at 10 a.m. EDT. The preliminary reading released in early October showed an increase in the index from 58.6 in September to 59.8.

See Also: Apple Analyst Continues To Recommend Owning Stock Despite Reducing Price Target — Here's Why

Stocks In Focus:

• Amazon Inc. AMZN fell over 12% in premarket trading after the e-commerce giant reported a revenue miss and issued light guidance.
• Pinterest Inc. PINS climbed over 10% after the social media company reported better-than-expected results and guided fourth-quarter revenue above consensus.
• Apple Inc. AAPL reported better-than-expected fourth-quarter results but commentary issued during the earnings calls points to a slowdown in the first quarter of 2023.
• Intel Corp. INTC rose about 5% on quarterly results.
• Edwards Life Sciences Corp. EW fell over 12% on disappointing quarterly results.
• AbbVie Inc. ABBV, Colgate-Palmolive Company CL, Exxon Mobil Corp. XOM and Chevron Corp. CVX are among the major companies due to report before the market open.

Commodities, Other Global Equity Markets:

Crude oil futures are slipping, snapping a three-session gain. A barrel of crude oil traded at a little over the $88 level, up about 0.85%.

The major Asia-Pacific markets retreated on Friday, with the Hong Kong and Chinese markets leading the slide. Sentiment soured amid the lingering COVID-19 threat in China and the mixed lead from Wall Street overnight. The Bank of Japan’s monetary-policy setting arm, which met on Friday, opted to keep its ultra-loose policy rate unchanged.

European stocks fell in late morning trading, as traders digested weak GDP reports from the region and stayed cautious ahead of next week’s U.S. Fed rate decision.

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