Traders work on the floor of the New York Stock Exchange during morning trading on May 17, 2024.
Michael M. Santiago | Getty Images
U.S. stock futures fell overnight on Thursday as investors focused on surging corporate earnings ahead of a key inflation report. Wall Street is also heading for a down week after a stellar month for stocks.
Dow Jones Industrial Average futures fell 35 points, or 0.09%, while S&P 500 futures and Nasdaq 100 futures fell 0.12% and 0.19%, respectively.
Traders were digesting the latest corporate earnings results. Dell Technologies fell 16% despite beating expectations in the first quarter. Cloud security stock Zscaler rose 14%, while developer data platform MongoDB plunged 23%. Apparel retailer Gap rose 21%, while department store chain Nordstrom fell more than 6%.
On Wall Street, the major stock indexes were down. The Dow Jones Industrial Average closed down more than 300 points, or 0.9%, after Salesforce reported weaker-than-expected earnings. The S&P 500 fell 0.6%, and the Nasdaq Composite fell 1.1%.
The moves came during a holiday-shortened trading week. The S&P 500 and Nasdaq Composite are both on track to end five-week winning streaks, while the Dow is on track to fall for a second straight week as rising Treasury yields weigh on investor sentiment.
Investors are worried that the volatility means the recent rally in stocks is starting to fade. They worry that gains in a few big tech stocks, such as Nvidia, are masking overall market weakness. The S&P 500 is up about 10% this year, while the equal-weighted index is up about 3%.
“When we see options prices expecting the momentum to continue or actually outperform historically, that becomes a problem for us,” Jeff DeGraff, head of technical research at Renaissance Macro Research, said on CNBC’s “Closing Bell,” pointing to the recent surge in semiconductor stocks such as Qualcomm Inc. and Nvidia Corp.
“The stock price may stabilize over the summer, but this is not the place to put new money,” DeGraff added. “So I want to be cautious because I think expectations are pretty elevated.”
Personal consumption expenditures data for April is due to be released Friday morning, and economists surveyed by Dow Jones expect core PCE to grow 2.7% year-over-year, down slightly from the previous reading of 2.8% growth.
The stock market is on track to finish off a strong month, with all major indexes on track to post their sixth straight positive month out of seven. The Dow is up 0.8% for the month, while the S&P 500 is up 4%. The tech-heavy Nasdaq Composite is on track to rise about 7%, its best month since November 2023, when it rose 10.70%.
