Equity futures are rising as the indices aim to reduce weekly losses

US equities rose on Friday, shaking off some losses earlier this week after concerns over persistent inflation and the resilience of the US economy sparked further volatility in recent sessions.

The S&P 500 rose more than 2% intraday on Friday, while the Nasdaq jumped more than 3.5% to reach its best day since mid-March. Dow added more than 400 points. The sharp rise came after central bank governor Jerome Powell reaffirmed in an interview with Marketplace Public Radio on Thursday that two more 50 basis point rate hikes were on the table for the next two Fed meetings, and that officials did not “actively consider”[ads1]; a more aggressive 75 increase in basis points. His comments reflected what other Fed officials also said this week.

Just a day earlier, the S&P 500 had closed within striking distance of a bear market, typically defined as a closure of at least 20% from a recent record high. The index has fallen by just over 18% from the record high of 3 January to the end of Thursday, and it went towards a weekly fall of 4.7% if the levels remain until the end of Friday’s session.

The Dow Jones Industrial Average and Nasdaq Composite also led to weekly losses of 3.6% and 6.4%, respectively, based on Thursday’s closing price. Treasury rates have risen, and then rose this week, with the 10-year reference rate at the Treasury hovering around 2.9% on Friday morning. Bitcoin prices returned to trading above $ 30,000 after setting the lowest level since December 2020, as a crater in Luna’s prices resonated further across the broader cryptocurrency market.

The market fluctuations this week coincided with two large inflation reports that came warmer than expected. Thursday’s producer price index showed an increase of 11% from year to year in wholesale prices last month, and this rate moderated only slightly from March’s record high rate of 11.5%. And the consumer price index released earlier this week showed a continued increase of 8.3% annual increase in prices paid by consumers last month.

“Inflation has certainly not only become relevant, but a real problem for the wider market, as the Fed has also increased the outlook for the number of [interest rate] needed increases, “Sonali Pier, Pimco’s CEO and portfolio manager, told Yahoo Finance Live on Thursday.” As for the effect of inflation, it is really at this point that we will see if the Fed raises interest rates and relaxes. some of the balance, can take off some of the inflation foam. “Because it’s pretty high, and it’s starting to affect companies – from their ability to push through from a price power perspective, as well as consumers, whether it’s at the gas station or as a result of food increases and the like.”

Other strategists agreed that the Fed’s response to inflation – and how well the economy performs when the Fed tightens financial conditions to meet inflation – will be the key factor for future markets.

“We are in an environment right now where inflation is high. The labor market is very tight. The Fed wants to bring inflation down. They want in a way to cool down the overheating in the labor market, which means that their bias is to tighten financial conditions and try to slow growth, “said Jason Draho, UBS Head of Asset Allocation, on Thursday. “In that environment, it’s not good for any kind of financial assets.”

“[Once] we get a kind of real break on inflation as people become much more comfortable with it moderating and moderating [to] a sustainable level that the Fed can be more comfortable with, and they do not have to go more aggressively … I think that’s the key catalyst, “said Draho. top, and that the Fed can reach the target in two years. “

“So for now, I think it’s definitely a choppy market,” he added.

12:02 ET: Shares rise, Nasdaq moves to the best day since mid-March

Here were the main features of the markets from kl. 12:02 ET:

  • S&P 500 (^ GSPC): +94.97 (+ 2.42%) to 4025.05

  • Dow (^ DJI): +469.85 (+ 1.48%) to 32,200.15

  • Nasdaq (^ IXIC): + 428.59 (+ 3.77%) to 11,799.55

  • Rough (CL = F): + $ 3.97 (+ 3.74%) to $ 110.10 per barrel

  • Gold (GC = F): – $ 16.80 (-0.92%) to $ 1,807.80 per ounce

  • 10-year Treasury (^ TNX): +8 bps to give 2.8970%

11:00 AM ET: Amazon faces the longest losing streak in 14 years in the middle of technology sales

The last week’s technology stocks have pulled shares of mega-cap tech names from Apple (AAPL) to Amazon (AMZN) well from record highs.

Amazon went against its longest losing streak since 2008, when shares in the e-commerce giant went towards a seventh weekly loss in a row. Based on Thursday’s closing price, the stock was heading for a weekly loss of 6.8%, although it was ready to reduce some of those losses in the middle of Friday’s rally.

Apple has similarly been dethroned as the world’s most valuable company, with the market value of Saudi Aramco surpassing the iPhone maker this week. Apple shares have fallen 19.7% so far this year through Thursday’s closing, compared with the S&P 500’s fall of 17.5% during this period.

10:15 AM ET: Consumer sentiment is falling to its lowest level since 2011: University of Michigan

Consumer sentiment fell to a low level of over ten years in early May, according to the University of Michigan, as concerns about inflation persisted.

The University of Michigan’s closely monitored Surveys of Consumers index fell to 59.1 in the preliminary May report, and fell sharply from the April reading of 65.2. The latest reading marked the lowest since 2011.

Sentiment decline “was broadly based – on current economic conditions as well as consumer expectations, and visible across income, age, education, geography and political affiliation – and continued the general downward trend in sentiment over the past year,” Joanne Hsu, Director of the Surveys of Consumers, said in a press release. “Consumers’ assessment of their current economic situation compared to a year ago is at the lowest reading since 2013, with 36% of consumers attributing their negative assessment to inflation.”

Consumers’ inflation expectations remained high in May, and the survey showed that inflation expectations for one year were unchanged at 5.4%. However, some strategists suggested that the fall in risk assets in recent weeks played an even greater role in the fall in the headline index.

“I would argue that the fall was largely a function of the fall in stock prices. We know that U. Mich is more sensitive to markets,” Neil Dutta, chief financial officer at Renaissance Macro Research, wrote in an email Friday morning. “Inflation is a problem, but inflation expectations were unchanged.”

09:33 ET: Stocks open higher

Here were the main features of the markets from 09:33 ET:

  • S&P 500 (^ GSPC): +43.33 (+ 1.10%) to 3,973.41

  • Dow (^ DJI): +241.55 (+ 0.76%) to 31,971.85

  • Nasdaq (^ IXIC): +189.64 (+ 1.67%) to 11,560.61

  • Rough (CL = F): + $ 3.05 (+ 2.87%) to $ 109.18 per barrel

  • Gold (GC = F): – $ 24.60 (-1.35%) to $ 1800.00 per ounce

  • 10-year Treasury (^ TNX): +9.8 bps to give 2.9150%

07:54 ET: Tesla shares jump in early trading after Musk said the Twitter deal on hiatus

Shares in Tesla (TSLA) rose more than 6% before opening time on Friday morning after CEO Elon Musk said his $ 44 billion plan to buy Twitter (TWTR) was halted, pending more details on where Much of Twitter’s usage base includes bot accounts.

“Twitter agreement temporarily pending pending details that support calculations that spam / fake accounts actually represent less than 5% of users,” Musk said in a Twitter post early Friday. He linked to a Reuters story which suggested that Twitter archives showed that fake accounts or spam accounts accounted for less than 5% of the company’s daily active users who could make money.

In announcing the deal to buy Twitter last month, Musk has suggested targeting bot accounts and user authentication was one of his priorities for the company after the deal.

Twitter shares fell 11% in early trading, hovering around $ 40 apiece.

07:45 ET Friday: Stock futures jump after Powell confirms 75 basis point rate hikes not under discussion

Here is where the markets traded before opening Friday morning:

  • S&P 500 futures (NO = F): +46 points (+ 1.17%) to 3,973.25

  • Dow futures (ÅM = F): +262.00 points (+ 0.83%) to 31,914.00

  • Nasdaq futures (NQ = F): +206.75 points (+ 1.73%) to 12,154.00

  • Rough (CL = F): + $ 1.79 (+ 1.69%) to $ 107.92 per barrel

  • Gold (GC = F): – $ 7.90 (-0.43%) to $ 1,816.70 per ounce

  • 10-year Treasury (^ TNX): + 9.8 bps to give 2.915%

18:10 ONE THURSDAY: Shares open lower

Here is where the markets traded Thursday night:

  • S&P 500 futures (NO = F): -10 points (-0.25%) to 3,917.25

  • Dow futures (ÅM = F): -73 points (-0.23%) to 31,579.00

  • Nasdaq futures (NQ = F): -41 points (-0.34%) to 11,906.25

Equity futures are rising as the indices aim to reduce weekly losses

NEW YORK, NEW YORK – MAY 12: Traders work on the floor of the New York Stock Exchange (NYSE) on May 12, 2022 in New York City. The Dow Jones Industrial Average fell in morning trading as investors continued to worry about inflation and other global problems. (Photo: Spencer Platt / Getty Images)

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter.

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