S&P 500 futures higher even after Declining week on Wall Street as investors abandoned stocks amid concerns about a new omicron Covid variant and the Federal Reserve’s move to tighten policy.
Nasdaq stock futures underperformed Sunday after bitcoin plummeted over the weekend and as investors continued to rethink owning high-value tech stocks.
Futures contracts tied to the Dow Jones Industrial Average rose 124 points, or 0.4%. S&P 500 futures are 0.3% higher. Nasdaq 100 futures oscillate around a straight line.
The Dow and S&P 500 fell 0.17% and 0.84%, respectively, on Friday. The Nasdaq Composite was the underperforming index, down 1.92%.
Tesla was the biggest influence on the tech-dense Nasdaq Friday, with shares of the electric-car maker sliding more than 6%.
Cathie Wood’s flagship Ark Innovation Fund is down more than 5% and all of the fund’s holdings are now in bear market beyond two stocks. Teladoc Health, Zoom Video, Roku, Palantir and Twilio are some of the names that have recorded heavy losses.
The strong sell-off in tech stocks has extended to the crypto world, where prices have also dropped. Bitcoin trading for about $57,000 on Friday morning, but by Saturday it was down to about $43,000. By Sunday, the world’s largest cryptocurrency was undo some of its loss, but it is still trading below the key $50,000 level.
Slower-than-expected job growth also contributed to broad market sales on Friday. Nonfarm payrolls increase 210,000 months ago, the Labor Department said on Friday, the number was lower than the 573,000 that economists surveyed by Dow Jones had expected.
“The softer payrolls print has dragged the rug down under the risk sentiment,” TD Securities wrote Friday in a note to clients. As investors fled to safety, the yield on 10-year Treasuries fell to 1.335%, the lowest since September 21.
The unemployment rate better-than-expected was 4.2%, down from 4.6% in October. According to Dow Jones, economists forecast the index at 4.5%.
“The job growth numbers are disappointing, especially since survey time was reduced before we knew the name of the latest Covid-19 variant,” said Jeffrey Buchbinder, equity strategist at LPL Financial. ,” said Jeffrey Buchbinder, equity strategist at LPL Financial. He added: “While Omicron may restrict hiring slightly over the next month or two, we remain confident in our expectations for strong job gains and above-average growth in the economy. US economy in 2022.
Friday’s selling ended a volatile week for key averages as investors assessed new information on the omicron variation.
All three major averages ended the week in the red, with the Dow posting its fourth straight week of losses for the first time since September 2020. The S&P and Nasdaq Composite both fell for a second straight week.
Small-caps were hit particularly hard, with the Russell 2000 down 3.86% for the week.
“Despite our forecast for a flat year for the S&P 500 … we remain bullish on the market pocket, including small-cap stocks,” Bank of America said on Thursday. Six in a note to customers. The company added: “Small-cap companies are typically more domestic, more exposed to service spending recovery, larger beneficiaries of investment/leaseback, and less expensive.” compared to large-cap companies.
However, Bank of America said the upside potential for small-cap stocks depends on Covid cases remaining under control.
The omicron variant has now been detected in at least 15 US states, CDC Director Dr. Rochelle Walensky told ABC News on Sunday.
“We know we have a few dozen cases and we’re monitoring them closely. And we’re hearing about more and more cases that could happen so that number is likely to go up,” she said on “This week.”
