US Stock Likely To Open On A Mixed Note After 2-Day Fall: 'We Do Not See The US Economy Dipping Into A Recession This Year'

U.S. stock futures swung on Thursday after two days of decline on Wednesday. Futures of major benchmark indices were trading mixed in premarket.

After a marathon 22-hour hearing, the House Rules Committee moved President Donald Trump‘s “$4.9 trillion legislative package” forward with an 8-4 vote on the “One Big Beautiful Bill Act.”

This action paves the way for a potential overnight floor vote, as Republicans press ahead despite internal party disagreements.

Meanwhile, the 10-year Treasury bond yielded 4.57% and the two-year bond was at 3.99%. The CME Group's FedWatch tool‘s projections show markets pricing a 94.7% likelihood of the Federal Reserve keeping the current interest rates unchanged in its June meeting.

The SPDR S&P 500 ETF Trust SPY and Invesco QQQ Trust ETF QQQ, which track the S&P 500 index and Nasdaq 100 index, respectively, rose in premarket on Thursday. The SPY was up 0.14% to $583.68, while the QQQ advanced 0.25% to $514.34, according to Benzinga Pro data.

Cues From Last Session:

Most S&P 500 sectors closed lower Wednesday, with real estate, healthcare, and financial stocks seeing the largest declines.

However, communication services bucked the trend, finishing higher. Investors remained cautious amid fresh worries about fiscal policy.

Meanwhile, Lowe's Companies Inc. LOW reported mixed first-quarter fiscal 2025 results, and Target Corp. TGT posted weaker-than-expected first-quarter figures.

On the economic front, U.S. mortgage application volumes fell 5.1% from the prior week for the period ending May 16.

The Dow Jones index declined 817 points or 1.91% to 41,860.44, whereas the S&P 500 index fell 1.61% to 5,844.61. Nasdaq Composite ended 1.41% lower at 18,872.64, and the small-cap gauge, Russell 2000, dropped 2.80% to 2,046.56.

Insights From Analysts:

The Senior Global Market Strategist at Wells Fargo, Scott Wren, said that “We do not see the U.S. economy dipping into a recession this year as consumer spending should continue to grow modestly with growth in real incomes.”

Wren anticipates a modest rebound in GDP next year, rising to 1.8% from their projected 1% for this year, following a continued growth slowdown over the next couple of quarters.

Wells Fargo doesn’t foresee a U.S. recession this year because consumer spending should continue its modest growth, bolstered by increasing real incomes, even if it’s weaker than late last year.

While unemployment is expected to tick up due to below-average economic growth, Wells Fargo’s 5.3% projection for 2026 remains well below recessionary levels.

Furthermore, he added that “We also still see plenty of up and down in equity prices but ultimately a higher S&P 500 Index by the end of 2026.”

Get Started

Earn 7.2% — No Matter What the Fed Does

Markets expect rate cuts — but your earnings don’t have to suffer. Lock in 7.2% until 2028 from ten individual bonds.

Get Started

Meanwhile, Kristian Kerr, head of macro strategy at LPL Financial, said that “Greater clarity is expected later this summer, as economic data tends to lag, meaning the full impact of tariffs may not be evident until June or July at the earliest.”

Additionally, he explained that the current policy landscape remains in flux, with broader tariffs largely paused until early July and China exempt from significant tariff increases until August 12.

“If meaningful economic weakness does materialize — confirmed by hard data mirroring the softness seen in leading indicators — or trade negotiations deteriorate, another bout of market volatility could ensue, potentially aligning with historical seasonal patterns where equities often struggle from late summer into fall.”

See Also: How to Trade Futures

Upcoming Economic Data

Here’s what investors will keep an eye on Thursday:

• Initial jobless claims data for the week ending May 17 will be out by 8:30 a.m. ET.

• The S&P flash U.S. services and manufacturing PMI for May will be released by 9:45 a.m. ET.

• April’s existing home sales will be announced by 10:00 a.m. ET.

• New York Fed President John Williams will speak at 2:00 p.m. ET.

Stocks In Focus:

• BJ’s Wholesale Club Holdings Inc. BJ was up 0.51% in premarket on Thursday as analysts expect it to report quarterly earnings of 91 cents per share on revenue of $5.20 billion, before the opening bell.
• Analog Devices Inc. ADI advanced 1.16% as Wall Street expects it to report earnings before the opening bell. It is expected to post earnings of $1.70 per share on revenue of $2.51 billion.
• Williams-Sonoma Inc. WSM was 0.048% higher as analysts expect it to report quarterly earnings of $1.76 per share on revenue of $1.67 billion, before the opening bell.
• Advance Auto Parts Inc. AAP rose 1.25% as Wall Street expects it to report earnings before the opening bell. It is expected to post a quarterly loss of 69 per share on revenue of $2.51 billion.
• Snowflake Inc. SNOW jumped 9.54% after posting better-than-expected earnings and sales results for the first quarter. The company also said it expects second-quarter product revenue in the range of $1.035 billion to $1.04 billion, up approximately 25% year-over-year.
• Zoom Communications Inc. ZM was 0.17% higher after reporting stronger-than-expected earnings for its first quarter after Wednesday's closing bell.
• Urban Outfitters Inc. URBN surged 17.50% after posting a better-than-expected first quarter result and highlighting diversification strategies to mitigate tariffs in its earnings call.
• Honeywell International Inc. HON was up 0.13% after announcing the acquisition of Johnson Matthey‘s Catalyst Technologies business, expanding its portfolio of leading catalyst and process technologies.
• Rio Tinto PLC ADR RIO advanced 0.58% after announcing the start of early works and final studies to increase Amrun mine's bauxite production on Queensland's Cape York Peninsula.

Commodities, Gold, And Global Equity Markets:

Crude oil futures were trading lower in the early New York session by 1.20% to hover around $60.83 per barrel.

Gold Spot US Dollar fell 0.10% to hover around $3,312.13 per ounce. Its last record high stood at $3,500.33 per ounce. The U.S. Dollar Index spot was higher by 0.169% at the 99.7170 level.

Asian markets were lower on Thursday as South Korea's Kospi, India's S&P BSE Sensex, Japan's Nikkei 225, Australia's ASX 200, Hong Kong's Hang Seng, and China’s CSI 300 indices declined. European markets were also lower in early trade.

Read Next:

• Cathie Wood’s Ark Invest Says Nuclear Energy Could Overtake Solar As Cheapest Power Source: Here’s A List Of Nuclear Energy Linked ETFs To Consider
  

Photo courtesy: Shutterstock