Stock futures inch lower after rocky start to 2023
Stock futures inched higher Tuesday evening after Wall Street started 2023 on a sour note.
Futures tied to the Dow Jones Industrial Average rose 0.04%, or 14 points, while S&P 500 and Nasdaq 100 futures traded flat rose 0.08% and 0.2%, respectively.
The overnight moves followed a down session for stocks as rising rate concerns, high inflation and recessionary fears crushed hopes that Wall Street could kick off the new year on a positive note.
During regular trading Tuesday, the Nasdaq shed 0.76%, while the Dow Jones Industrial Average and S&P 500 dipped 0.03% and 0.4%, respectively. Shares of Tesla plummeted more than 12% on delivery numbers that missed expectations, while Apple fell 3.7% on reports of production cuts.
Six of the 11 major S&P sectors closed lower, led to the downside by energy. The sector was the best performer in 2022 as oil prices boosted energy stocks. Communication services gained about 1.4%, led to the upside by Meta Platforms and Walt Disney.
“U.S. stocks were unable to hold onto earlier gains as restrictive policy and recession fears remained front and center for investors,” wrote Oanda’s senior market analyst Ed Moya in a note to clients Tuesday. “Discount buying triggered another bear market rebound that didn’t last long at all.”
Many investors have been hoping the market would bounce back after the major averages notched their worst year since 2008. The Federal Reserve and its tightening plan hang over markets in the near term, along with fears of a looming recession.
Investors will gain more insight into what Fed members are thinking on Wednesday afternoon as minutes from the central bank’s latest policy meeting are released. Earlier in the day, the Job Openings and Labor Turnover Survey, or JOLTS, and ISM manufacturing data are due out.
Friday’s December jobs report also will be closely watched as it is the last read on the labor market before the Fed meeting in February.
“It is too early to start betting on a Fed pivot this year and that should make this difficult environment for stocks,” Moya said.
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