- US stock index futures are trading mixed on the final day of the week.
- Inflation data from US producers exceeded forecasts.
- The Energy sector was the top performing SP500 sector on Thursday.
US stock index futures will turn lower following the release of January inflation data in the US, which was better than expected. At press time, S&P 500 futures were down 0.13%, Dow Jones futures were down 0.28%, and Nasdaq futures were up 0.15%.
The S&P 500 (SPX), Dow Jones (DJIA) and Nasdaq (IXIC) indices closed Thursday up 0.58%, 0.91% and 0.30%, respectively.
What you need to know before the stock markets open
- The Energy sector gained nearly 2.5% as the S&P 500's strongest sector on Thursday, closely followed by the Real Estate sector, which added 2.36% on the day.
- The technology sector finished Thursday as the worst performer of the S&P 500, with a loss of 0.44%.
- The Bureau of Labor Statistics reported Friday that the Producer Price Index (PPI) of final demand in the US rose 0.9% annually in January. This figure, after the 1% increase registered in December, was above market expectations (0.6%). The core PPI increased 2% annually in the same period, compared to 1.8% in December. On a monthly basis, the core PPI rose 0.5%, following a 0.1% decline in the previous month.
- Zebra Technologies Corp. (ZBRA) rose 12.17% on the day and ended at $283.75. West Pharmaceutical Services Inc. (WST) took the top spot on the list of biggest decliners, with its shares losing more than 14%, closing at $350.70.
- The CBOE Volatility Index (VIX), a measure of fear on Wall Street, rose more than 2% after the IPP data.
- As reported Thursday by the US Census Bureau, US retail sales fell 0.8% in January to $700.3 billion. This figure was lower than market expectations, which expected a decrease of 0.1%. Retail sales without cars contracted 0.6% in the same period.
- In the week ending February 10, 212,000 first-time applications for unemployment benefits were registered, compared to 220,000 the previous week, the US Department of Labor announced.
- Inflation in the United States, measured by the variation in the Consumer Price Index (CPI), softened to 3.1% annually in January, from 3.4% in December, the BLS reported on Tuesday. This figure exceeded market expectations, which placed it at 2.9%.
- The core CPI, which excludes food and energy price volatility, rose 3.9% in the same period and matched December's increase, beating analysts' estimate of 3.7%.
- Coinbase Global Inc. (COIN) reported fourth-quarter earnings of $1.04/share after the closing bell Thursday, down from a loss of $2.46/share a year earlier. The company noted robust trading volumes due to a resurgence of interest in crypto was the main reason for the first quarterly profit it posted since 2021.
- On Tuesday, Coca-Cola Co. (KO) reported that profits rose 7.4% to $10.95 billion from a year ago for the quarter ended in December, according to Reuters. The company announced that quarterly net income was $1.97 billion for that period and cited higher product prices and robust demand for the optimistic results.
- Airbnb Inc. (ABNB) said after the closing bell on Tuesday that adjusted quarterly earnings were 76 cents per share for the quarter ended in December. The company's profits rose 16.6% to $2.22 billion from a year ago, but there was a quarterly loss of $349 million.
- Cisco Systems Inc. (CSCO) reported adjusted quarterly earnings per share of 87 cents for the quarter ended January. The networking equipment maker said profits fell 5.9% to $12.79 billion from a year ago, while quarterly net income was $2.63 billion in the same period. In a conference call, CEO Charles Robbins stated: “We also continue to see weak demand from our telecommunications and cable service provider customers,” according to Reuters. The company reportedly plans to cut more than 4,000 jobs and focus on high-growth areas such as artificial intelligence and software.
Nasdaq FAQ
What is Nasdaq?
Nasdaq is an American stock exchange that began as an electronic stock ticker. At first, the Nasdaq only offered over-the-counter (OTC) stock listings, but it later became an exchange as well. By 1991, the Nasdaq had grown to represent 46% of the entire US stock market. In 1998, it became the first US exchange to offer online trading. The Nasdaq also produces several indices, the most comprehensive of which are the Nasdaq Composite, which represents the more than 2,500 Nasdaq securities, and the Nasdaq 100.
What is the Nasdaq 100?
The Nasdaq 100 is a large-cap index composed of 100 non-financial companies on the Nasdaq Stock Exchange. Although it only includes a fraction of the thousands of stocks on the Nasdaq, it explains more than 90% of the movement. The influence of each company in the index is weighted based on market capitalization. The Nasdaq 100 includes companies highly focused on technology, although it also includes companies from other sectors and from outside the United States. The Nasdaq 100's average annual return has been 17.23% since 1986.
How can I trade the Nasdaq 100?
There are several ways to trade the Nasdaq 100. Most retail brokers and spread betting platforms offer Contracts for Difference (CFD) betting. For long-term investors, exchange-traded funds (ETFs) operate like stocks that mimic the movement of the index without the investor having to buy all 100 companies that comprise it. An example of an ETF is the Invesco QQQ Trust (QQQ). Nasdaq 100 futures contracts allow you to speculate on the future performance of the index. Options provide the right, but not the obligation, to buy or sell the Nasdaq 100 at a specific price (strike price) in the future.
What factors drive the Nasdaq 100?
There are many factors that drive the Nasdaq 100, but primarily it is the aggregate performance of its component companies, revealed in their quarterly and annual earnings reports. US and global macroeconomic data also contribute, influencing investor sentiment, which if positive, drives earnings. The level of interest rates, set by the Federal Reserve (Fed), also influences the Nasdaq 100, as it affects the cost of credit, on which many companies largely depend. Therefore, the level of inflation can also be an important factor, as well as other parameters that influence the Federal Reserve's decisions.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
