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Dow Futures Down 355 Pts; Growth Concerns Weigh Heavily

Stock Markets Jun 30, 2022 06:48AM ET
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© Reuters.

By Peter Nurse

Investing.com -- U.S. stocks are seen opening sharply lower Thursday, with the quarter on course to end on a gloomy note as investors fret that aggressive rate hikes to curb red-hot inflation will result in a rapid slowing of economic growth.

At 07:00 AM ET (1100 GMT), the Dow Futures contract was down 355 points, or 1.1%, S&P 500 Futures traded 53 points, or 1.4% lower, and Nasdaq 100 Futures dropped 185 points, or 1.6%.

Sentiment is at a low ebb on Wall Street, with the Dow Jones Industrial Average and the S&P 500 on track for their worst quarter since the first three-month period of 2020 when COVID lockdowns sent the market into a tailspin. The tech-heavy Nasdaq Composite is set for its worst quarter since 2008, down more than 20% over the last three months.

Central bank chiefs from the Federal Reserve, European Central Bank, and Bank of England met in Portugal this week and voiced their renewed commitment to control inflation.

"The way to do that [curb inflation] is to slow down [economic] growth, but ideally keep it positive,” Fed chair Jerome Powell said on Wednesday, conceding that there “is a risk” that the monetary tightening could go too far and cause a recession.

Sweden's Riksbank continued the hiking theme Thursday, lifting its key interest rate by half a percent, adding it would run down its asset purchases faster than planned to stop inflation from becoming entrenched.  

The Fed’s fastest rate-hiking cycle in decades appears to be already slowing growth, with the final reading of first-quarter GDP revised down by 0.1% to a 1.6% contraction on an annualized basis.

Attention will now turn to the release of data on U.S. core prices later in the session, as well as personal income and spending data for May and the weekly initial jobless claims.

In the corporate sector, brewer Constellation Brands (NYSE:STZ) and pharmacy chain Walgreens Boots Alliance (NASDAQ:WBA) are set to post quarterly updates early Thursday, while semiconductor manufacturer Micron (NASDAQ:MU) is due after the market closes.

Oil traded largely flat Thursday, on course for its first monthly loss this year ahead of the latest meeting of top crude-producing countries.

The Organization of Petroleum Exporting Countries and allies is widely expected to confirm another modest production increase for August later Thursday, with limited room for a significant boost to output, given the group has struggled to meet its previously agreed production targets this year.

U.S. crude inventories fell by about 2.8 million barrels in the week to June 24, data from the Energy Information Administration showed, but gasoline stockpiles climbed as near-record prices likely encouraged people to stay closer to home.

By 07:00 AM ET, U.S. crude futures traded 0.6% lower at $109.13 a barrel, on course for a monthly loss of over 4%, while the Brent contract fell 0.4% to $111.98, set to drop over 2% in July.

Additionally, gold futures fell 0.4% to $1,810.70/oz, while EUR/USD traded 0.3% lower at 1.0406.

Dow Futures Down 355 Pts; Growth Concerns Weigh Heavily
 

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Comments (9)
Gershom Zvi
Gershom Zvi Jun 30, 2022 9:52PM ET
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Stockmarket is Biden’s priority number 1001 but for Trump da stockmarket was numero UNO
Matt Kay
Matt Kay Jun 30, 2022 3:01PM ET
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Half the comments are spam and the other is necks of red color
Alan Rice
Alan Rice Jun 30, 2022 3:01PM ET
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At least 1 is pink. (I guarantee it !!)
nssskk nath
nssskk nath Jun 30, 2022 10:27AM ET
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To protect growth, FED may review its rate cuts for reduction and time staggering ?
nssskk nath
nssskk nath Jun 30, 2022 10:27AM ET
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To protect growth, FED may review its rate cuts for reduction and time staggering
Jack Peterson
Jack Peterson Jun 30, 2022 8:55AM ET
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Is your financial advisor telling you not to worry and stay in the markets? Of course they are! What else are they going to say? Be cautious…. And prudent with YOUR money right now.. alot of people are going to lose alot of money… then see what your advisor says!
Khmer Sak
Khmer Sak Jun 30, 2022 8:11AM ET
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1840
Jim Divers
Jim Divers Jun 30, 2022 8:08AM ET
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The market clearly does not trust this administration. Thats the key driver.
Jeff Chevalier
Jeff Chevalier Jun 30, 2022 8:08AM ET
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Biden came in the Dow was around 27k. In two years it was 36k. What were you thinking then?
Jim Divers
Jim Divers Jun 30, 2022 8:08AM ET
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28,868.80 on jan 2 so get your info together. Plus we had been shut down. Futures this morning pointing toward 30,690 and this administration says we have a robust economy. Come on you cant be happy with what you are seeing. I voted for him and wish I had not.
Brad Albright
Brad Albright Jun 30, 2022 8:08AM ET
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Why did you pick January 2 ?
Vicki Lynn
Vicki Lynn Jun 30, 2022 8:08AM ET
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The DOW was just over 31k when Biden was inaugurated.
Jack Peterson
Jack Peterson Jun 30, 2022 7:56AM ET
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Algorithms and excessive exuberance have run the markets for years now.. there is no more “gut” feeling or report or inverted yeild curve that triggers anything anymore, this is now no different than going to Vegas… good luck everyone, we are about to separate the men from the boys
babu reddy
babu reddy Jun 30, 2022 7:33AM ET
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I am long for tomorrow...as all the negatives are digested...
dar dar
dar dar Jun 30, 2022 7:33AM ET
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good luck with that
 
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