A trader works on the trading floor at the New York Stock Exchange (NYSE) in New York City, January 26, 2023.
Andrew Kelly | Reuters
Stock futures fell slightly on Friday morning as investors close out a winning week for markets that saw better-than-expected economic growth and a pop in market-darling Tesla.
Futures tied to the Dow Industrial Average eased by 24 points. S&P 500 futures shed 0.3%, while Nasdaq 100 futures were down 0.5%. Shares of Intel slumped more than 9% in after-hours trading following a dismal earnings report that missed on the top and bottom lines.
Stocks rose during regular trading Thursday, cheering a better-than-expected fourth quarter gross domestic product report that stoked hopes that the U.S. economy can experience a soft landing as the Federal Reserve hikes rates to tame inflation.
The Dow Jones Industrial Average gained more than 205 points, or 0.61%, notching its fifth consecutive winning session, the first streak of that length since October. The S&P 500 rose 1.10% and the tech-heavy Nasdaq Composite jumped 1.76%.
All three indexes are positive for the week and month. The Dow and the S&P 500 have gained 1.7% and 2.2% this week, respectively. The Nasdaq is up 3.3% on the week and is set to notch its best monthly performance since July. The Nasdaq has gained the last four weeks.
“This year’s stock market rally is impressive and shouldn’t be ignored,” Chris Zaccarelli, chief investment officer for the Independent Advisor Alliance said in a Thursday note. “Unfortunately, the Fed is likely to start talking down the market again, as early as next week, so prepare for volatility again this year; we may be in the eye of the hurricane and not completely out of the woods yet.”
Tesla closed out Thursday with an 11% gain after earnings and revenue for the last quarter topped expectations and CEO Elon Musk projected the carmaker could possibly produce 2 million cars this year. The widely followed stock was down 65% last year to lead a rout in the growth sector. The shares are up more than 30% this year.
On Friday, investors will be watching for economic reports that will give more information about the state of inflation. Personal income and spending and pending home sales for December are due in the morning. The personal consumption expenditures price index, a preferred inflation measurement for the Federal Reserve, is also due. Consumer sentiment for January will also be released.
It’s some of the last data that will be released ahead of the Fed’s next interest-rate decision on Feb. 1. Investors are currently expecting a 0.25 percentage point interest rate hike from the central bank.
Earnings season continues as well. American Express, Colgate-Palmolive and Chevron are among companies scheduled to report quarterly results Friday. Investors may be watching Chevron’s report closely after the company announced a $75 billion stock buyback and dividend boost on Wednesday.