Futures, Stocks Fall as Amazon Stokes Tech Worry: Markets Wrap
(Bloomberg) -- U.S. equity futures retreated with stocks Friday as investors worried about slowing growth at megacap technology companies. Treasuries rose.
Nasdaq 100 contracts slid more than 1% as Amazon.com Inc. slipped in premarket trade after its sales outlook missed expectations. The decline in S&P 500 futures was less severe, with Chevron Corp. and Exxon Mobil Corp. rising after results.
European equities dropped from a record and Asian stocks slid amid China’s regulatory clampdown.
Markets have been whiplashed this week by China’s tightening regulatory grip, a slew of earnings and the outlook for stimulus, and traders see more volatility on the cards. Amazon’s outlook adds to cautious forecasts from Facebook Inc. and Apple Inc., stoking a debate about whether tech stocks’ pandemic-related outperformace will give way to a cyclical revival.
The dollar was steady, on course for its biggest weekly drop since May. Treasuries rose.
“The earnings season has delivered strong results so far, however some investors are concerned that earnings growth will slow from here,” said Lewis Grant, senior global equities portfolio manager at the international business of Federated Hermes. “It was a case of better to travel than arrive for the FAANG stocks. On the other hand, the economy is opening up as we move past the peak infections and consumer balance sheets are strong, and that should support the cyclical end of the market.”
Investors piled into cash and equities in the past week, according to a Bank of America Corp. note citing EPFR Global data. BofA strategists recommended owning defensive and quality names in the second half of the year, as “policy flip-flops will end in market correction.”
Elsewhere, Pinterest Inc. tumbled after analysts said the company’s monthly user trends were disappointing.
Bitcoin dropped below $39,000 after a recent rally.
For more market analysis read our MLIV blog.
Here are the main moves in the markets:
Stocks
Futures on the S&P 500 fell 0.7% as of 8:14 a.m. New York timeFutures on the Nasdaq 100 fell 1.1%Futures on the Dow Jones Industrial Average fell 0.3%The Stoxx Europe 600 fell 0.4%The MSCI World index fell 0.3%
Currencies
The Bloomberg Dollar Spot Index was little changedThe euro was little changed at $1.1891The British pound was little changed at $1.3966The Japanese yen fell 0.2% to 109.66 per dollar
Bonds
The yield on 10-year Treasuries declined three basis points to 1.24%Germany’s 10-year yield was little changed at -0.45%Britain’s 10-year yield was little changed at 0.57%
Commodities
West Texas Intermediate crude fell 0.1% to $73.51 a barrelGold futures fell 0.2% to $1,831.60 an ounce
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