Nasdaq, S&P 500 Futures Climb After Thursday's Strong Rebound, Bitcoin Sizzles: Analyst Predicts A Roller Coaster Ride For Stocks Until This Happens
Author: Shanthi Rexaline | August 09, 2024 07:35am
Sentiment continues to remain upbeat as stocks look to close out a volatile week on a positive note. The major index futures traded modestly higher in early trading, and given the absence of any major catalysts, the market could most likely consolidate its recent gains. Traders may dread to take huge positions ahead of next week’s inflation reports and retail sales data.
The CBOE Volatility Index, commonly called VIX, fell toward the 23 level, extending its slide from Thursday. The yen has strengthened slightly against the greenback, potentially stirring anxiety among traders. Bond yields are flatlining, while the rest of global markets have fed off the strength of Wall Street.
Futures
Performance (+/-)
Nasdaq 100
+0.24%
S&P 500
+0.14%
Dow
+0.03%
R2K
+0.40%
In premarket trading on Friday, the SPDR S&P 500 ETF Trust (NYSE:SPY) rose 0.17% to $531.54, and the Invesco QQQ ETF (NASDAQ:QQQ) rose 0.34% to $449.61, according to Benzinga Pro data.
Cues From Last Session:
U.S. stocks turned in a stellar performance on Thursday, as a report showing a bigger-than-expected decline in jobless claims, some positive earnings reports and the yen’s weakness set in motion a wave of buying in beaten-down stocks. The jobless claims data mitigated concerns regarding the weakening of the labor market and in turn, allayed recession worries.
The averages opened higher, moved roughly sideways and took a leg-up in the afternoon before moving sideways yet again. The S&P 500 had the best outing since Nov. 30, 2022, in terms of the percentage of gains, according to Marketwatch.
The buying was across the board, with IT stocks spearheading the advance.
Index
Performance (+/)
Value
Nasdaq Composite
+2.87%
16,660.02
S&P 500 Index
+2.30%
5,319.31
Dow Industrials
+1.76%
39,446.49
Russell 2000
+2.42%
2,084.42
Insights From Analysts:
Fund manager Louis Navellier expects the volatility to persist in August. The month is marked by “gyrations” and “air pockets,” he said, adding that this is attributable to “many Wall Street pros, plus Europe” being on vacation. “Low trading volume in August provides fertile ground for wild market gyrations like Monday's,” Navellier said.
“So I am expecting this down, up, down market action to persist until the trading volume is exhausted,” he added.
David Sadkin, President at Bel Air Investment Advisors, said the markets appear to be entering into a correction phase, with the much-loved tech sector leading the way. The strategist is sanguine, as he pointed to the economy, which while slowing, is continuing to expand, the better-than-expected European GDP growth and robust earnings growth. He expects the market to end higher by year-end.
If the economy does slow, the Fed has leeway to cut rates and boost liquidity by other means to cushion any potential downside, Sadkin said. “Also, as we get more clarity on the geopolitical and the US political landscape, the market will likely settle down and continue its upward trajectory,” he said.
“Long-term investors will weather a slowdown by remaining dispassionate and focusing on fundamentals rather than market panic.”
Upcoming Economic Data:
There are no major economic data/events scheduled for the day.
Akamai Technologies, Inc. (NASDAQ:AKAM) climbed about 7.5% in premarket trading following the announcement of its quarterly results.
The other stocks moving on earnings are CarGurus, Inc. (NASDAQ:CARG) (up over 11.5%), e.l.f. Beauty, Inc. (NYSE:ELF) (down over 9%), Expedia Group, Inc. (NASDAQ:EXPE) (up over 10.50%), Doximity, Inc. (NYSE:DOCS), Five9, Inc. (NASDAQ:FIVN) (down over 15%), Paramount Global (NASDAQ:PARA) (up over 6%), Take-Two Interactive Software, Inc. (NASDAQ:TTWO) (up over 6%), and Trade Desk, Inc. (NASDAQ:TTD) (up over 7%).
Crude oil as well as gold futures extended their gains and the 10-year Treasury note yield slipped 4.2 points to 3.957%. Bitcoin (CRYPTO: BTC) rallied strongly toward the $60.5K mark.
Taking cues from the U.S. market, stocks in Asia closed mostly higher, with the tech-heavy Taiwanese market leading the gains. The Chinese market retreated on inflation data that came in more than expected and the New Zealand market also settled modestly lower, while the Singaporean market was closed for a public holiday.
