The major U.S. index futures are currently pointing to a roughly flat open on Friday, with stocks likely to show a lack of direction following the weakness seen in the previous session.
Uncertainty about the outlook for the markets may keep some traders on the sidelines following yesterday’s weakness, which saw the S&P 500 pull back off its record highs.
Traders may also be reluctant to make significant moves ahead of earnings news from Nvidia (NASDAQ:NVDA), as the AI darling is due to report its quarterly results after the close of trading next Wednesday.
Next week will also see the release of the Federal Reserve’s preferred readings on consumer price inflation, which could impact the outlook for interest rates.
Nonetheless, while the broader markets may lack direction, a steep drop by shares of UnitedHealth (NYSE:UNH) is likely to weigh on the Dow.
The Dow futures are down by 0.6 percent, as UnitedHealth is plunging by 12.4 percent in pre-market trading after a report from the Wall Street Journal said the Justice Department has launched an investigation into the health insurance giant’s Medicare billing practices in recent months.
After moving sharply lower early in the session, stocks regained some ground over the course of the trading day on Thursday. The major averages climbed well off their early lows but remained firmly in negative territory.
The S&P 500 fell as much as 1.0 percent in early trading but ended the day more moderately lower, down 26.63 points or 0.4 percent at 19,962.36. The Nasdaq also slid 93.89 points or 0.5 percent to 19,962.36 after tumbling as much as 1.3 percent.
The narrower Dow posted a more significant loss, slumping 450.94 points or 1.0 percent to 44,176.65.
The early sell-off on Wall Street came amid a slump by shares of Walmart (NYSE:WMT), with the retail giant and Dow component plunging by 6.5 percent.
Walmart came under pressure after the company reported better than fiscal fourth quarter earnings but provided disappointing guidance for the current year.
Traders may also been looking to cash in on the recent upticks by stocks, which lifted the S&P 500 to record highs despite ongoing tariff concerns and indications the Federal Reserve is likely to keep interest rates on hold for some time.
On the U.S. economic front, a report released by the Labor Department showed a modest increase by first-time claims for U.S. unemployment benefits in the week ended February 15th.
The Labor Department said initial jobless claims rose to 219,000, an increase of 5,000 from the previous week’s revised level of 214,000.
Economists had expected jobless claims to inch up to 215,000 from the 213,000 originally reported for the previous week.
The Federal Reserve Bank of Philadelphia also released a report showing Philadelphia-area manufacturing activity continued to expand in the month of February, although the index of activity in the sector pulled back sharply.
Financial stocks turned in some of the market’s worst performances, with the KBW Bank Index and NYSE Arca Broker/Dealer Index tumbling by 2.4 percent and 1.9 percent, respectively.
The nosedive by shares of Walmart also weighed on the retail sector, as reflected by the 1.9 percent loss posted by the Dow Jones U.S. Retail Index.
Meanwhile, gold and oil producer stocks moved to the upside on the day amid increases by the prices of their associated commodities.
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