After turning lower over the course of the previous session, stocks may see further downside in early trading on Friday. The major index futures are currently pointing to a lower open for the markets, with the Dow futures down by 160 points.
A negative reaction to earnings news from financial giants JPMorgan Chase (JPM), Citigroup (C) and Wells Fargo (WFC) may lead to initial weakness on Wall Street.
Shares of JPMorgan are seeing pre-market weakness even though the company reported fourth quarter results that beat expectations on both the top and bottom lines.
JPMorgan benefited from the release of money previously set aside for expected loan defaults, although its earnings would have still beat estimates with the boost.
Citigroup and Wells Fargo may also move the downside after both reported better than expected fourth quarter earnings but on revenues that missed estimates.
Negative sentiment may also be generated in reaction to a report from the Commerce Department showing a continued decline in U.S. retail sales in the month of December.
The Commerce Department said retail sales fell by 0.7 percent in December after tumbling by a revised 1.4 percent in November.
Economists had expected retail sales to come in unchanged compared to the 1.1 percent slump originally reported for the previous month.
Excluding sales by motor vehicle and parts dealers, retail sales plunged by 1.4 percent in December after sliding by 1.3 percent in November.
Ex-auto sales were expected to edge down by 0.1 percent compared to the 0.9 percent decrease originally reported for the previous month.
Meanwhile, a separate report released by the Labor Department showed U.S. producer prices increased by slightly less than expected in the month of December.
The Labor Department said its producer price index for final demand rose by 0.3 percent in December after inching up by 0.1 percent in November. Economists had expected producer prices to rise by 0.4 percent.
Excluding food and energy prices, core producer prices crept up by 0.1 percent in December, matching the uptick seen in the previous month. Core prices were expected to edge up by 0.2 percent.
Just before the start of trading, the Federal Reserve is scheduled to release its report on industrial production in the month of December. Industrial production is expected to rise by 0.4 percent in December, matching the increase seen in November.
The University of Michigan is due to release its preliminary reading on consumer sentiment in the month of January shortly after the start of trading. The consumer sentiment index is expected to edge down to 80.0 in January from 80.7 in December.
Additionally, the Commerce Department is scheduled to release its report on business inventories in the month of November. Business inventories are expected to climb by 0.5 percent.
Stocks saw modest strength for much of the trading session on Thursday before giving back ground going into the close. The major averages all slid into negative territory, with the Dow and the Nasdaq pulling back off the record intraday highs set in early trading.
The major averages finished the day modestly below the unchanged line. The Dow slipped 68.95 points or 0.2 percent to 30,991.52, the Nasdaq edged down 16.31 points or 0.1 percent to 13,112.64 and the S&P 500 fell 14.30 points or 0.4 percent to 3,795.54.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Friday. Japan's Nikkei 225 Index slid by 0.6 percent, while Hong Kong's Hang Seng Index rose by 0.3 percent.
Meanwhile, the major European markets have all moved to the downside on the day. While the French CAC 40 Index has tumbled by 1.2 percent, the German DAX Index is down by 1 percent and the U.K.'s FTSE 100 Index is down by 0.9 percent.
In commodities trading, crude oil futures are sliding $0.60 to $52.97 a barrel after climbing $0.66 to $53.57 a barrel on Thursday. Meanwhile, after slipping $3.50 to $1,851.40 an ounce in the previous session, gold futures are falling $5.50 to $1,845.90 an ounce.
On the currency front, the U.S. dollar is trading at 103.72 yen versus the 103.80 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.2118 compared to yesterday's $1.2155.
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