Investing.com– U.S. stock index futures fell Friday with risk sentiment hit by an escalation of Middle East tensions, also weighed by disappointing guidance from tech major Netflix (NASDAQ:).
At 06:50 ET (10:50 GMT), fell 140 points or 0.4%, fell 23 points, or 0.5%, while fell 120 points, or 0.7%.
The main Wall Street indices closed in a mixed fashion Thursday, with the managing to close with small gains. The , however, fell 0.2%, logging a five-day losing streak, and the fell 0.5%.
The broad-based S&P 500 is on course for weekly losses of 2.2%, heading for its third straight negative week, and its worst since the end of October last year.
Sentiment weakened after Israel’s missile strike on Iran earlier Friday hit risk appetite, escalated tensions in the region and raised the possibility of continuing retaliation between the Middle East powers.
Hawkish Fed signals continue, Bostic warns of rate hike
That said, the main negative driver has been falling expectations of an interest rate cut by the Federal Reserve any time soon as U.S. economic data have proved resilient.
A slew of Fed officials, including Chair Jerome Powell, warned this week that rates were set to remain higher for longer in the face of sticky inflation.
Atlanta Fed President Raphael Bostic went as far as to say that the Fed could even hike interest rates this year if inflation did not ease as expected, although he still expected a single rate cut in 2024.
Bostic’s comments rattled an already fragile market, which was reeling from investors sharply pricing out their expectations for a June rate cut.
Netflix to stop reporting quarterly subscriber data
Also weighing on sentiment was a poorly received earnings report from Netflix, with the video streaming giant’s second-quarter revenue outlook missing expectations, raising concerns that slowing consumer spending could weigh on corporate earnings in the coming months.
Netflix also unexpectedly said it would stop reporting quarterly membership numbers and average revenue per membership starting next year with its Q1 2025 earnings, largely overshadowing a bumper first-quarter report, and prompting premarket losses of over 6%.
Earnings continue with P&G, American Express on tap
The first-quarter earnings season is set to pick up pace in the coming days, with reports from Procter & Gamble (NYSE:) and American Express (NYSE:) due on Friday.
Next week, market giants including Tesla (NASDAQ:), General Electric (NYSE:) and Meta Platforms (NASDAQ:) are set to report earnings by Wednesday.
Crude hands back early gains
Crude prices weakened Friday, handing back the early gains that followed reports of Israeli missiles striking Iran.
By 06:50 ET, the U.S. crude futures traded 0.6% lower at $82.33 a barrel, while the Brent contract dropped 0.5% to $86.65 per barrel.
The crude benchmarks had posted gains of around 3% earlier Friday after Iran’s Fars news agency said that explosions were heard at an airport in the Iranian city of Isafahan, while U.S. news outlet ABC News cited a U.S. official as saying that Israeli missiles had hit a site in Iran.
However, the strikes have since been seen as relatively limited, and gains were quickly sold into.
(Ambar Warrick contributed to this article.)
