- Nasdaq futures fell 0.9% on Friday as investors weighed disappointing earnings from Amazon and Apple.
- Amazon fell 8.5% in premarket Friday after posting an unexpected loss and weak second-quarter outlook.
- Oil rose after Germany said it was ready to stop buying Russian oil, highlighting the possibility of a full EU embargo.
Nasdaq futures fell on Friday after Amazon posted its first loss in seven years and Apple warned of further supply chain constraints, while Chinese tech stocks soared. arrow in the hope of political support.
Dow Jones futures fell 0.3%, while those on the S&P 500 were down 0.6% at 6:15 a.m. ET. Nasdaq futures lost 1%, suggesting a lower start to trading later in the day.
Earnings sentiment was bullish on Thursday after Facebook’s parent company Meta reported positive first-quarter results. But disappointing reports from other tech heavyweights after the bell weighed on investor sentiment early on Friday.
Amazon fell 8.5% premarket after reporting an unexpected quarterly loss of $7.38 per share and a weak second-quarter outlook. Analysts on average had expected the e-commerce giant to post earnings of $8.40 per share.
Investors were also pricing in Apple’s warnings that supply issues following China’s COVID-19 shutdowns could cut sales by up to $8 billion. The iPhone maker fell 2.4% in Friday’s premarket.
Still, Apple’s downfall is overtaken by post-earnings declines suffered earlier this year by Netflix and Meta, both of which fell around 20% after revealing a drop in user numbers.
“It’s a testament to the resilience of the brand and that it’s dealing with tangible products, not ephemeral internet services,” said eToro analyst Mark Crouch.
The drop in Nasdaq futures follows a strong close for the tech-heavy index in the previous session, supported by a recovery in Meta user growth and CEO Mark Zuckerberg limiting spending on the metaverse division.
Thursday’s data showed U.S. gross domestic product fell for the first time since the early days of the pandemic, at an annualized rate of 1.4%. Economists had forecast growth of 1.1%.
Another event that could spook the market is an update to the Federal Reserve’s preferred inflation gauge, as higher inflationary pressures could mean further tightening in financial conditions, Saxo Bank’s Peter Garnry said. The release of the core PCE price index for March is expected later.
Asian stocks rose after China’s Politburo, the Communist Party’s decision-making committee, said it would step up policy support for the coronavirus-hit economy.
“We should waste no time in planning more policy tools and building up the strength of timely adjustment,” the Politburo said on Friday.
The Shanghai Composite closed up 2.4%, while Hong Kong’s Hang Seng rose 4%. The Tokyo Nikkei added 1.8%.
The Hang Seng Tech index jumped 10% as speculation grew over a possible easing of Beijing’s year-long crackdown on internet companies. The Hang Seng Tech index jumped 10% as tech surged, with Alibaba and Meituan up more than 15%.
In Europe, shares rose as investors digested a list of strong results from companies including British bank Barclays, consumer giant Unilever and French spirits group Pernod Ricard.
London’s FTSE 100 edged up 0.1%. The pan-European Euro Stoxx 600 gained 0.8% and the Frankfurt DAX jumped 0.9%.
Markets are closely watching the latest developments regarding the war between Russia and Ukraine. Gas prices in Europe fell after surging sharply on Wednesday as Russia halted shipments to Poland and Bulgaria because they refused to pay in roubles.
Crude oil prices rose after Germany said it was ready to stop buying Russian oil, opening the door to an import ban by the European Union.
Brent futures rose 1.6% to $108.99 a barrel and West Texas Intermediate rose 1.2% to $106.65 a barrel.
“The rise is attributable to the increased likelihood of an EU oil embargo against Russia now that Germany has ceased to oppose such a measure,” said Carsten Fritsch of Commerzbank.
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