Friday April 1st


Stock futures rise to kick off new quarter

U.S. Stock index futures rose Friday as investors assessed a new quarter of trading and a troublesome bond market recession indicator. Dow Jones Industrial Average futures gained 132 points, or 0.4%. S&P 500 futures rose 0.3% and Nasdaq 100 futures added about 0.4%. Stocks for now shook off a recession signal from the bond market that was triggered after the closing bell Thursday and again on Friday morning. The 2-year and 10-year Treasury yields inverted for the first time since 2019. For some investors, it’s a signal that the economy is headed for a possible recession, though the inverted yield curve does not predict exactly when it will happen and history shows it could be more than a year away or longer. Investors were also digesting the official jobs report for March, which showed the U.S. economy adding 431,000 jobs. The result was below the composite estimate of 490,000 but above some of the lower end estimates. The Dow Jones Industrial Average slumped on Thursday to close out the first negative quarter for stocks in two years, with losses accelerating in the final hour of trading. The Dow dropped 550.46 points, or 1.56%, to 34,678.35. The S&P 500 slid 1.57% to 4,530.41, and the Nasdaq Composite was down 1.54% to 14,220.52. All three major averages posted their worst quarter since March 2020. The Dow and S&P 500 declined 4.6% and 4.9% respectively during the period, and the Nasdaq dropped more than 9%. Stocks did stage a late-quarter comeback in March however after sharp declines from rising interest rates and inflation marked the first part of the year. “I think everybody needs to acknowledge the fact that we are obviously going to be moving into a slower economic environment,” Shannon Saccocia, chief investment officer at Boston Private Wealth, told CNBC’s “Closing Bell.” “You need to get earnings growth from somewhere, and if it’s not going to be a secular tailwind, like fiscal spend and monetary policy looseness, then you have to look for growth elsewhere. I think we’re going to see some real nuance in trading over the course of the next three months or so as people look for that growth against this more challenging economic backdrop.” GameStop rallied more than 15% in extended trading after the video game retailer and meme stock announced its intentions for a stock split. Energy prices declined on Thursday after the White House said it will release an unprecedented amount of oil from the Strategic Petroleum Reserve. Up to 1 million barrels of oil per day will be released for the next six months. Other key indicators to watch out for include the ISM manufacturing index and the construction spending report, both of which will be released at 10 a.m. ET on Friday. Shares in Asia-Pacific were mixed in the first trading day of the new quarter as a private survey showed Chinese manufacturing activity shrank in March. The Hang Seng Tech index declined 0.74% to 4,524.25. Hong Kong’s broader Hang Seng index recovered from earlier losses to close 0.19% higher at 22,039.55. In mainland China, the Shanghai composite rose 0.94% to end the trading day at 3,282.72 while the Shenzhen component climbed 0.905% to 12,227.93. Elsewhere in Asia-Pacific, the Nikkei 225 in Japan slipped 0.56% to close at 27,665.98 while the Topix index fell 0.11% to 1,944.27. In South Korea, the Kospi dipped 0.65% on the day to 2,739.85. Oil prices seesawed on Friday ahead of a meeting of International Energy Agency (IEA) member nations set to discuss a release of emergency oil reserves alongside a huge planned release by the United States. Brent crude futures slid 8 cents to $104.63 per barrel after falling 5.6% on Thursday. U.S. West Texas Intermediate (WTI) crude futures declined 32 cents to $100.02 per barrel. Both contracts were down earlier in the session. The two benchmark contracts were also headed for their biggest weekly losses in two years at 14% and 13%, respectively. Gold eased on Friday and was headed for a weekly fall, as higher Treasury yields dented the appeal of zero-yield bullion, with a stronger dollar adding further pressure. Spot gold was down 0.2% at $1,934.01 per ounce. U.S. gold futures fell 0.8% to $1,937.90. “It is in particular the developments in the fixed income markets with yields rising again,” that are pressuring gold, said Quantitative Commodity Research analyst Peter Fertig.