U.S. equity futures moved higher in early Thursday trading, following a tech-lead selloff on Wall Street last night that dragged the S&P 500 to its lowest levels in a week, as investors looked to add risk positions heading into the Easter holiday weekend.
Updated at 6:31 AM EDT
Unhealthy start
UnitedHealth Group (UNH) shares are in free-fall this morning, plunging as much as 20% at one point in premarket trading after the country’s biggest health insurance group posted weaker-than-expected first quarter earnings and slashed its full-year profit forecast.
UnitedHealth’s $115 slump is likely to lop more than 700 points from the Dow Jones Industrial Average, which is now called around 500 points lower in premarket trading.
Related: UnitedHealth stock tumbles after Medicare Advantage changes hit outlook
Stock Market Today
The Nasdaq lead stocks lower last night with a 3.07% decline, paced by a 6.9% slump for Nvidia (NVDA) after the AI chipmaker took a $5.5 billion inventory hit tied to new export restrictions on sales to China. The S&P 500, meanwhile, finished 120 points lower as selling accelerated following hawkish comments from Federal Reserve Chairman Jerome Powell.
Powell told an economic event in Chicago that President Trump’s tariffs were having a larger-than-expected effect on growth and inflation prospects, while adding he and his colleagues would need to wait longer to determine their appropriate policy response.
“Tariffs are highly likely to generate at least a temporary rise in inflation …. the inflationary effects could also be more persistent,” Powell said.
“Avoiding that outcome will depend on the size of the effects, on how long it takes for them to pass through fully to prices, and, ultimately, on keeping longer-term inflation expectations well anchored,” he added.
Federal Reserve Chairman Jerome Powell insisted yesterday that the central bank would not act prematurely on policy simply to support equity markets.
Kevin Dietsch/Getty Images
Markets appear modestly more bullish heading into today’s session, following comments from President Donald Trump touting progress in U.S. trade talks with Japan and a muted reading for the CBOE Group’s VIX volatility gauge, which was holding at $30.64 in after-hours trading.
“The markets and investors want certainty and of this much I am certain: this year will be a more difficult year for investors than the last two cake walks,” said Gina Bolvin, president of Bolvin Wealth Management Group in Boston.
“Powell wondered how long it would take to see tariffs’ effects on inflation and may be inclined to do nothing until we get more clarity on inflation,” she added. “Investors have to be more patient. We are a tweet (X) away from a rally. Or steeper losses.”
Related: Analysts revisit Nvidia stock price targets as US restricts China chip sales
On Wall Street, futures contracts tied to the S&P 500, which is down 6% for the month and languishing in the throes of its fifth worst start to start to any trading year on record, are priced for a 44 point opening bell gain.
The Dow Jones Industrial Average, meanwhile, is called 300 points higher while the Nasdaq is priced for a 170 point gain with Nvidia, Tesla (TSLA) and Apple (AAPL) supporting early gains.
Hertz Global Holdings (HTZ) were a notable early mover as well, soaring 27.1% to $7.26 per share after activist investor Bill Ackman’s Pershing Square Capital reportedly built a 4.1% stake in the car rental group.
In overseas markets, Europe’s Stoxx 600 was marked 0.56% higher in mid-day Frankfurt trading ahead of today’s European Central Bank rate decision that is widely expected to deliver a quarter point cut to its benchmark deposit facility, which would take it to 2.25%.
Overnight in Asia, Trump’s trade talk comments helped Japan’s Nikkei 225 finished 1.35% higher on the session, with a solid outlook from chip contractor Taiwan Semiconductor helping tech stocks into the final hours of trading.
The regional MSCI ex-Japan benchmark, meanwhile, was marked 0.88% higher heading into the close of trading.
More Economic Analysis:
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