(Bloomberg) — Technology stocks led declines in U.S. stock futures Thursday after Meta Platforms Inc.’s disappointing outlook underscored the risk of volatility during a week of high-stakes earnings.
Most read on Bloomberg
Nasdaq 100 contracts fell 1.2%, with Meta accounting for about half of that decline. Facebook’s parent company fell 19% after hours in the United States as it forecast second-quarter sales below analysts’ expectations and an increase in estimated spending for the year. Alphabet Inc., which will report results later along with Microsoft Corp., also fell. S&P 500 futures slipped 0.6%.
Europe’s Stoxx 600 index fell as traders processed a deluge of company updates on the busiest day of earnings season. Anglo American Plc soared 13% after rival mining giant BHP Group made a share buyback proposal, valuing it at £31.1 billion ($38.8 billion).
Besides the results, traders are eagerly awaiting U.S. economic growth figures due later, after weeks of lowering their expectations for an interest rate cut from the Federal Reserve. Economists surveyed by Bloomberg forecast that GDP is expected to have cooled to around 2.5% in the first quarter, with the numbers still potentially suggesting lingering inflationary pressures.
“Any downside surprises could lead markets to announce expected Fed interest rate cuts earlier, after being pushed back much later this year,” said economists at Rand Merchant Bank in Johannesburg. “However, upside surprises could lead to continued market volatility as the market attempts to determine the risk that a hotter-than-expected economy poses to anticipated interest rate cuts.”
The yen extended its losses after weakening beyond 155 per dollar for the first time in more than three decades on Wednesday, increasing the chances of intervention ahead of the Bank of Japan’s policy decision on Friday.
The yen depreciated to 155.74 per dollar on Thursday, a new 34-year low against the dollar. The BOJ is expected to keep interest rates unchanged on Friday, while the falling currency makes it more likely that the bank will soften its stance towards accommodative policy.
“Ueda’s press conference is expected to take a hawkish tone, and even if the yen’s depreciation does not accelerate, the government is likely to intervene at the same time and push the yen up by around 5 yen,” said Eiji Dohke. strategist at SBI Securities. The first intervention would likely be billions of yen, followed by small, long-term purchases, he said.
Treasuries were little changed after yields rose in the previous session. Investors absorbed a $70 billion sale of five-year Treasuries on Wednesday at a slightly higher-than-expected yield, following even stronger demand for Tuesday’s two-year Treasury bond auction.
In Asia, the region’s stock index fell more than 1% as shares in South Korea and Japan fell. Stocks outperformed in Hong Kong amid increased buying by Chinese investors. Continent…
