Stock futures were flat on Thursday as a wave of mixed quarterly results left investors feeling uncertain about the market’s direction. The S&P 500 futures and Nasdaq 100 futures both saw slight dips of less than 0.1%, while Dow Jones Industrial Average futures lost 65 points, or 0.2%.
Micron shares took a hit in premarket trading, dropping more than 5% after the chipmaker issued fourth-quarter revenue guidance that met expectations. Levi Strauss also disappointed investors with a 17.7% drop in its latest quarterly revenue, while Walgreens Boots Alliance saw a steep 21.5% decline after cutting its full-year outlook and reporting lower-than-expected earnings in the previous quarter.
Bank stocks were also in focus following the Federal Reserve’s announcement that the largest U.S. firms are prepared to weather a severe recession scenario. Goldman Sachs shares slid 2.3% in early trading.
Despite the overall sluggish trading activity, megacap tech companies continued to perform well on Wednesday, with Amazon shares reaching an all-time high and surpassing $2 trillion in market capitalization for the first time.
Investors are now eagerly awaiting the release of May’s personal consumption expenditures price index on Friday, hoping for signs of easing inflation that could pave the way for the Fed to lower interest rates later this year.
As the market grapples with these uncertainties, strategists are divided on whether the current rally led by artificial intelligence stocks can be sustained in the second half of the year. Some experts predict that the S&P 500 may only see minimal gains by the end of the year.
Brian Levitt, global market strategist at Invesco, emphasized the importance of market expectations aligning with the Fed’s actions. “What you’ll need likely is greater expectation coming into this market that the inflation story is really behind us, that the Fed can lower rates, and the soft landing happens,” he said in an interview with CNBC’s “Closing Bell” on Wednesday.
