Stock futures fall as Amazon and Apple shares fall after quarterly reports

U.S. stock futures opened sharply lower on Thursday evening to return to gains after a steady session rally, with another round of mixed quarterly results from some big tech companies weighing on index futures.

Contracts on the S&P 500, Dow and Nasdaq each fell. Shares of tech juggernaut Amazon fell in late trading after the company unexpectedly posted a quarterly loss and offered a weaker-than-expected current quarter outlook. Apple shares also fell even after the iPhone maker beat quarterly sales and earnings estimates, though the company still cited ongoing supply chain constraints.

Earlier, the S&P 500 closed sharply higher on Thursday, gaining 2.5%, while the Nasdaq Composite rose 3.1% in its best day since March 16. But even with Thursday’s sharp gains, the S&P 500 was still on track to post its third month. drop in four months.

Volatility has resurfaced in recent weeks amid concerns about whether tighter monetary policies from the Federal Reserve could derail the economy. And those fears have deepened with lingering concerns over lingering inflation, geopolitical unrest and an ongoing COVID outbreak in China. The S&P 500 headed down about 5% in April, if losses hold through Friday’s close.

“There’s a lot of revaluation going on, whether it’s the revaluation of equity valuations, the revaluation of interest rate expectations, or the revaluation of inflation expectations, versus to the tightening that’s happening at the Fed,” Todd Jablonski, senior director of global asset allocation, told Yahoo Finance Live. “Threats of an economic slowdown, threats of inflation and threats of rising energy prices as a result of the conflict in Ukraine [are] all sorts of things come together to really undermine investor confidence and sentiment.”

Additionally, this week’s data on corporate earnings and the broader economy has been mixed. Earnings from big tech companies, including Alphabet and Twitter, pointed to a slowdown in online advertising activity as companies cut marketing spend following moderating consumer demand. And throughout this earnings season, a plethora of companies across industries have reported high input and labor costs, as well as continued supply chain disruptions.

Against this backdrop, the US economy contracted for the first time since the second quarter of 2020 earlier this year, government data showed on Thursday. The 1.4% annualized contraction in US GDP in the first quarter came as net trade, inventories and government investment each weighed on overall domestic output, and consumer spending grew less vigorously than expected.

However, the weaker-than-expected GDP print could also prompt Federal Reserve members to exercise more caution as they prepare to raise interest rates further and begin to pull assets off the balance sheet. of the central bank. These measures would raise borrowing costs and help depress demand to stem inflation, but also risk tipping the economy into a deeper downturn if financial conditions tighten too quickly.

“There are so many worries around us, are we going to go into a recession in the next 24 months because the Fed might raise interest rates too much?” Ryan Payne, president of Payne Capital Management, told Yahoo Finance Live. “I think that’s what’s really weighing on the markets, and more than the fact that we have a war in Ukraine and those inflationary numbers just exploded.”

6:11 p.m. ET Thursday: Stock futures tumble as Amazon, Apple shares decline

Here’s where the shares were trading Thursday night:

  • S&P 500 Futures Contracts (ES=F): -35.75 points (-0.83%) to 4,247.75

  • Dow futures contracts (JM=F): -62 points (-0.18%) to 33,766.00

  • Nasdaq futures contracts (NQ=F): -219.5 points (-1.63%) to 13,235.25

NEW YORK, NEW YORK – APRIL 28: Traders work on the floor of the New York Stock Exchange (NYSE) on April 28, 2022 in New York City. The Dow Jones Industrial Average was up in morning trading as markets continued to go through a period of volatility due to inflation fears and the war in Ukraine. (Photo by Spencer Platt/Getty Images)

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter.

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