Market Snapshot: Stock futures point to sharp losses for tech after disappointing Amazon and Apple results

U.S. stock futures were lower on Friday, with technology poised for a sharp selloff, as investors reacted to disappointing results from heavyweights Inc. and Apple Inc.

How are stock-market indexes trading?

On Thursday, the Dow Jones Industrial Average

rose 240 points, or 0.68%, to 35730, the S&P 500

increased 45 points, or 0.98%, to 4596, and the Nasdaq Composite

gained 212 points, or 1.39%, to 15448.

What’s driving the market?

The S&P 500 and Nasdaq closed at records on Thursday, lifted by earnings news and hopes for a budget deal as investors shook off a disappointing third-quarter growth report.

But downbeat results from two big tech companies were weighing heavy. Reporting late Thursday, Apple

missed revenue expectations for the first time since late 2018, amid slower-than-expected sales of iPhones and wearables.

reported an earnings drop of nearly 50% and a disappointing holiday forecast as it struggles with supply-chain and staffing issues. Amazon shares were down nearly 5% in early premarket trading, while Apple was down over 3%.

“Companies will feel the heat going forward with all input costs rising from wages, financing, and commodities including energy,” said Steen Jakobsen, chief investment officer at Saxo Bank, in a note to clients.

“However, the VIX forward curve still suggests low nervousness among equity investors over the near-term future. The 4,560 level in the S&P 500 futures is a critical pivot point for today’s trading which will determine which way we go,” Jakobsen said.

Opinion: Apple and Amazon are struggling, so investors may want to look to these tech stocks instead

Energy giants Chevron Corp.

and Phillips 66

will report Friday, along with Newell Brands Inc.

and Colgate-Palmolive Co.

Rising bond yields were also a focus for investors, with the yield on the 10-year Treasury note

up 4 basis points to 1.600%. That follows the biggest one-day yield gain since Oct. 19 on Thursday, which snapped a four-day losing streak.

Traders have been factoring in expectations for tighter Federal Reserve monetary policy as yield curves flatten across the globe. Many expect the Fed will announce a plan next week for tapering its $120 billion in monthly bond purchases.

Markets largely brushed aside European Central Bank President Christine Lagarde’s attempt on Thursday to push back against rising market expectations for policy interest rate increases by the end of next year.

A huge batch of data is ahead, including personal income, spending and core inflation for September, the third-quarter employment cost index at 8:30 a.m. Eastern Time, followed by the final University of Michigan consumer sentiment index, which is due at 10 a.m. Eastern.

Which companies are in focus?
How are other assets trading?

This post was originally published on Market Watch

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