The US stock index futures slipped slightly on Friday as traders were nervous about the heavy sell-off in technology stocks and CPI report
Investing.com- The U.S. stock index futures were slightly down in the early hours of Friday as traders seemed nervous about the previous day’s sell-off in technology stocks and an important consumer price index (CPI) report. At 5:35 ET (10:35 GMT), ($) Dow Jones Futures were down 95 points (0.2%), S&P 500 Futures were down 5 points (0.1%), and NASDAQ 100s were down 5 points (0.1%).
The major indices on Wall Street fell yesterday due to a sharp drop in the tech-driven Nasdaq Composite, which may have created additional concerns regarding the potential consequences of AI on financial markets. Dow Jones lost approximately 670 points (1.3%); S and P 500 lost nearly 1.6%; while Nasdaq Composite was down 2%.
Upbeat Outlook of Applied Materials
The technology market is getting a lot of attention lately, with major companies such as Arista Networks (NYSE: ANET), Applied Materials (NASDAQ: AMAT), and Pinterest (NYSE: PINS) all posting their earnings reports after trading closes on Thursday. Arista reaffirmed its full-year gross margin guidance despite being dented by increased memory chips.
Meanwhile, Applied Materials has provided positive guidance on increasing sales at the largest US semiconductor equipment maker due to both the boom in AI-related technology and ongoing supply shortages for DRAM memory chips.
Conversely, Pinterest forecast first-quarter revenue below the estimates due to larger reductions in ad spend by retailers that are affected by the ongoing imposition of tariffs, as well as increased competition from companies with larger marketplace budgets.
Read: Gold Rebounds After Sharp Decline Triggered by Wider Market Fears
Looming CPI Data
The traders are focusing on a consumer price index (CPI) inflation figure released for January (later this session), which will be used to get more cues about the world’s largest economy. It is expected that both headline and core CPI will slightly cool down as compared to the previous month.
The CPI has printed above market expectations in January for 4 years now, and therefore, markets remain on edge for a hot reading.
Following much stronger-than-anticipated nonfarm payroll numbers in January, the uncertainty surrounding rates has increased this week. The data showed that the labour market was still in a tight phase, leading the Fed to have less motivation to lower rates.
Further indications of elevated inflation could reinforce this, providing pressure on U.S. markets. Current pricing suggests a high probability of no changes to policy during March or April, as highlighted on CME Fedwatch.
Higher Crude and Gold
Gold prices were up during European trading as gold managed to recover from recent declines due to increasing uncertainty surrounding U.S. interest rates. Gold benefited from safe-haven buying on Friday afternoon, as multiple reports indicated that Washington has plans to send another aircraft carrier (the USS Gerald R. Ford) to the Middle East due to stalled nuclear negotiations with Iran.
Spot gold was trading at $4970.79 an ounce for a gain of 1%, while gold futures were up 0.9% at $4994.21 an ounce. Last session spot prices were down more than 3%. Oil prices were flat on Friday but were set for weekly declines due to anticipated concerns about large supply surpluses and high inventory levels.
In addition, fears that a war would break out between the U.S. and Iran have also diminished. Brent crude futures were $67.80 per barrel for an increase of 0.4%, while WTI crude was selling for $63.08 per barrel for a gain of 0.4%. Both contracts were down nearly 3% the previous session and are expected to put them on the track for under 1% weekly losses.
