Stock Futures Rise on Friday as the Market Prepares for a Disappointing Week

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Last Updated on November 4, 2022 by Bitfinsider

Stock futures climbed on Friday as investors evaluated the October jobs report and what it means for the Fed’s future rate rises.

Futures on the Dow Jones Industrial Average rose 195 points, or 0.6%. S&P 500 futures were 0.7% higher, while Nasdaq 100 futures were 0.8% higher.

On Friday, a better-than-expected October nonfarm payrolls report stoked some concerns that the Fed will continue its tightening drive. The report showed that 261,000 payrolls were added in October, exceeding a Dow Jones forecast of 205,000 gains. The unemployment rate was 3.7%, slightly higher than the projected 3.5%.

Given the uptick in both unemployment and job creation, some investors saw Friday’s jobs report as a mixed bag.

The Dow sank 0.5% on Thursday, while the S&P 500 fell 1%. Meanwhile, the Nasdaq fell 1.7%. Investors considered the Fed’s last 0.75 percentage point rate hike, as well as comments from head Jerome Powell that signaled a pivot may be further away than traders expected.

All of the main averages are on course to end the week in the red. The Dow is down 2.62% as of Thursday’s close, bringing a four-week winning streak to an end. The S&P 500 and Nasdaq are both down 4.64% and 6.84%, respectively, and are on track to snap two-week winning streaks. The Nasdaq, which is heavily weighted toward technology, is also on track for its worst weekly performance since January 2022.

The corporate earnings season has resumed, with Block, a mobile payment startup, jumping 13% after exceeding expectations. Carvana stock fell after reporting a larger-than-expected loss, while Twilio and Atlassian also fell after providing disappointing forecasts.

According to data issued Friday by the Bureau of Labor Statistics, the US economy added more jobs than predicted last month.

In October, employment increased by 261,000, exceeding the Dow Jones forecast of 205,000.

DraftKings – Despite announcing a smaller-than-expected quarterly loss and revenue that exceeded Wall Street estimates, DraftKings slumped 12.5% in premarket trade. The sports betting operator recently boosted its revenue forecast and cautioned that a prolonged economic downturn could reduce user spending.

Stocks in ChinaShares of Chinese firms listed in the United States rose in after-hours trading on suggestions that China would relax its rigorous Covid-19 rules. Alibaba (BABA) increased by 9.7%, (JD) increased by 9.3%, Pinduoduo (PDD) increased by 8.8%, and Bilibili (BILI) increased by 14.4%.

Starbucks – Starbucks shares jumped 4.6% in premarket trading after the coffee company reported higher-than-expected profit and revenue for the most recent quarter, with sales reaching a new high. Starbucks claims that its investments in new equipment and higher worker remuneration are paying off.

DoorDash – DoorDash stock rose 11.9% in premarket trading on the strength of record orders and higher-than-expected revenue, despite a larger-than-expected quarterly loss. Customers continue to spend on meal delivery even as costs rise.

Carvana – Carvana fell 7.4% in premarket trade after reporting lower-than-expected quarterly results. Increased automobile prices and rising borrowing rates were major contributors in the decline in demand.

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