Stock futures are falling even after Amazon reported a surge in earnings

FAANG shares are listed on the Nasdaq.

Adam Jeffery | CNBC

Futures contracts, pegged to major U.S. stock indices, fell at the start of the overnight session on Thursday night as investors pondered a flurry of earnings results and a robust profit blow from e-commerce giant Amazon.

Contracts related to the S&P 500 fell 0.15%, while contracts related to the Dow lost 20 points. The Nasdaq 100 futures were also down 0.3%.

The off-hours movements took place after the end of regular trading amid a flurry of income activity.

Amazon, the last Wall Street mega-cap tech company to release results, posted record earnings in the first quarter. The Seattle-based company announced that profits more than tripled to $ 8.1 billion and sales grew 44% to $ 108 billion from January to March.

The company’s results showed that demand for its massive online retail business as well as its high-growth cloud computing and advertising businesses remained strong. In expanded trading, stocks rose 3.7%.

Twitter moved in the opposite direction in terms of user growth results and revenue guidance for the second quarter, which lagged behind analysts’ forecasts. According to the social media platform, monetizable daily active users for the three months ended March 31 were 199 million and reported earnings per share of 16 cents.

Exxon Mobil, Chevron and Colgate-Palmolive will all report wins on Friday.

Twitter and Amazon stock performance is likely to affect the S&P 500 on the last trading day of the week. The index closed on Thursday after the results from Apple and Facebook at a record level.

The Dow Jones Industrial Average ended the regular session up 0.7%, while the S&P 500 gained just under 0.7% to end the day at 4,211.47, a new closing high. The tech-heavy Nasdaq Composite, which started the day up 1%, underperformed by just over 0.2%.

So far this week, the S&P 500 is up 0.75%, the Dow is up less than 0.1% and the Nasdaq Composite is up 0.47%.

Wall Street will also keep an eye on personal income and expense data, which is due to be released Friday morning at 8:30 a.m. ET. This data could give investors and the Federal Reserve valuable insight into how fast prices are rising in the U.S. economy as it recovers from the Covid-19 pandemic.

Fed chairman Jerome Powell told reporters on Wednesday that the central bank would have to hold inflation at around 2% “for some time” before curbing supportive asset purchases and interest rates close to zero.

“All arrows point to further spike in inflationary pressures. Remember, the Fed knows; they are prepared for this,” wrote Patrick Leary, chief market strategist at Incapital. “While I’m not going to say whether the inflation we’re seeing is actually going to be temporary or more sustainable, I am willing to bet it will rise higher and last longer than the market will tolerate.”

Become a smarter investor with CNBC Pro.
Get stock picks, analyst calls, exclusive interviews and access to CNBC TV.
Sign in to start a free trial today

Comments are closed.