Traders work on the flooring of the New York Stock Exchange (NYSE) in New York City, U.S., June 15, 2022.
Brendan Mcdermid | Reuters
U.S. inventory futures fell Thursday night time after the S&P 500 closed out its worst first-half efficiency in a long time.
Futures tied to the Dow Jones Industrial Average traded 67 factors decrease, or 0.2%. S&P 500 and Nasdaq 100 futures additionally dipped 0.2% every.
Micron Technology shares fell greater than 2% in after-hours buying and selling on the again of disappointing fiscal fourth-quarter steerage.
Thursday marked the finish of the second quarter and the first half of the yr. For the quarter, the S&P 500 fell greater than 16% — its greatest one-quarter fall since March 2020. For the first half, the broader market index dropped 20.6% for its largest first-half decline since 1970. It additionally tumbled into bear market territory, down greater than 21% from a document excessive set early January.
The Dow Jones Industrial Average and Nasdaq Composite weren’t spared from the onslaught. The 30-stock Dow misplaced 11.3% in the second quarter, placing it down greater than 15% for 2022. The Nasdaq, in the meantime, suffered its greatest quarterly drop since 2008, shedding 22.4%. Those losses pushed the tech-heavy composite deep into bear market territory, down almost 32% from an all-time excessive set in November. It’s additionally down 29.5% yr up to now.
Those steep first-half and quarterly losses come as traders grapple with sky-high inflation and tighter financial coverage. The core private consumption expenditures index – the Federal Reserve’s most popular inflation gauge, rose 4.7% final month on a year-over-year foundation. While that was barely under a Dow Jones estimate, it was nonetheless close to multidecade highs.
The Fed, in flip, has stepped up its efforts in opposition to the surge in costs, mountaineering by 0.75 share level in June. That was its greatest charge improve since 1994.
Both of those elements have resulted in escalating recession worries. First-quarter GDP contracted by 1.6%, and the Atlanta Federal Reserve’s GDPNow tracker is pointing to a different 1% decline in financial output for the second quarter.
“If we have any words of comfort, it is that universal losses at this pace rarely take place in successive quarters, but this is not the same as saying that further losses should not be anticipated,” wrote Michael Shaoul of Marketfield Asset Management. “This still very much looks to be the middle of the story, the period in which a previously ‘pacific’ outlook is replaced by something far stormier, and we are yet to see any signs that the weather is about to turn for the better.”
Traders will absorb extra financial knowledge Friday, with the newest ISM manufacturing index and building spending numbers set for launch at 10 a.m. ET.
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