Stock futures declined on Wednesday, a day following the Nasdaq Composite’s worst session since October. Futures linked to the Dow Jones Industrial Average slipped by 61 points (0.2%), while S&P 500 futures and Nasdaq-100 futures lost 0.2% and 0.3%, respectively.
Bloomin’ Brands, the owner of Outback Steakhouse, experienced a more than 4% increase after adding two new members to its board. This move was part of an agreement with activist investor Starboard Value.
The market started the new calendar year on a negative note, with the S&P 500 falling 0.6%, and the Dow finishing less than 0.1% higher on Tuesday. The Nasdaq Composite dropped over 1.6%, recording its worst day since October, influenced by major technology stocks and a nearly 4% decline in Apple following a downgrade by Barclays.
Analysts note that the burden of proof seems to be on the bears as the new year begins. Chris Verrone from Strategas mentioned that short-term corrections are normal in a market coming off fresh highs and entering primary season. He added that the longer-term outlook appears positive on a six- to twelve-month horizon.
After a remarkable year in 2023, where all major averages rebounded from the challenges of 2022, the market has witnessed a rotation back into risk assets, driven by easing inflation, a drop in the 10-year Treasury yield, and expectations of rate cuts in 2024. The Federal Reserve’s shift from aggressive tightening to potential rate cuts, along with optimism for a soft landing, has contributed to positive sentiment. Stock futures declined
Market participants are closely watching for clues in the minutes from the Fed’s December policy meeting, set to be released on Wednesday, as well as remarks from Richmond Fed President Tom Barkin. Additionally, the job openings report for November and December’s ISM manufacturing data are also expected to provide insights into the economic landscape.
European stocks had a muted open, with the regional Stoxx 600 index starting the session flat before nudging 0.2% higher by 8:20 a.m. London time.