U.S. stock futures are pointing to a higher open on Friday, suggesting markets could recover after the weakness seen in the previous session.
A sharp rally in shares of Intel Corp (NASDAQ:INTC) is likely to support early buying, with the chipmaker jumping more than 25% in premarket trading.
The surge follows stronger-than-expected first-quarter earnings from Intel, along with a second-quarter revenue outlook that exceeded analyst forecasts.
Corporate Movers Lift Sentiment
Procter & Gamble (NYSE:PG) is also trading higher ahead of the open after reporting fiscal third-quarter results that beat expectations.
Investor sentiment is further supported by a pullback in oil prices, which are easing after recent sharp gains.
According to Reuters, Iranian Foreign Minister Seyed Abbas Araghchi is set to arrive in Pakistan for talks with the U.S., raising hopes for de-escalation.
Oil prices are also under pressure after President Donald Trump confirmed a three-week extension of the ceasefire between Israel and Lebanon.
Previous Session Ends Lower
After Wednesday’s rally, stocks moved broadly lower on Thursday, with major indices pulling back from recent highs.
Although markets recovered somewhat after an early afternoon drop, they still closed firmly in negative territory. The Nasdaq fell 219.06 points, or 0.9%, to 24,438.50, the S&P 500 declined 29.50 points, or 0.4%, to 7,108.40, and the Dow Jones Industrial Average dropped 179.71 points, or 0.4%, to 49,310.32.
Profit-taking played a role in the early weakness, following gains earlier in the week.
Stock-Specific Pressure
A significant decline in IBM (IBM) also weighed on the market, with shares falling 8.3% despite reporting earnings above expectations but failing to raise full-year guidance.
Honeywell (NASDAQ:HON) also came under pressure after posting better-than-expected first-quarter earnings but issuing a weaker-than-expected outlook for the second quarter.
In contrast, Texas Instruments (NASDAQ:TXN) surged 19.4% after reporting strong results and offering upbeat guidance.
Oil Volatility Adds Pressure
Stocks saw another wave of selling in the afternoon as oil prices spiked. Although U.S. crude futures later pulled back, they still ended the day up more than 3% after earlier surging nearly 6%.
The jump followed reports from Israel’s N12 that Iran’s parliament speaker Mohammad Bagher Ghalibaf had stepped down from the country’s negotiating team due to tensions with the Revolutionary Guard.
Concerns over a renewed escalation in the U.S.-Iran conflict also weighed on markets after President Donald Trump said he had ordered the Navy to “shoot and kill any boat” that is placing mines in the Strait of Hormuz.
Trump added that Iran is “having a very hard time figuring out who their leader is,” citing divisions between “hardliners” and “moderates.”
These comments increased uncertainty around the prospects for renewed peace talks, with Trump rejecting claims that he is “anxious” to end the conflict.
Sector Performance Mixed
Software stocks were among the hardest hit, with the Dow Jones U.S. Software Index dropping 5% after reaching its highest closing level in nearly three months in the previous session.
ServiceNow (NYSE:NOW) led the decline, plunging 17.8% despite posting stronger-than-expected results.
Computer hardware stocks also weakened, with the NYSE Arca Computer Hardware Index falling 2.9%.
Gold, biotechnology and brokerage stocks also moved lower, while utilities and semiconductor shares posted gains during the session.