The US stock market doesn’t look poised to extend Wednesday’s record-setting after-Christmas rally, with S&P 500, Nasdaq 100, and Dow Jones Industrial Average futures all portending sharp declines on Thursday morning.
On Wednesday, the three prominent Wall Street indices had broken out of their recent slump to post major gains, bolstered by bullish data on holiday consumer spending, strong showings in the energy sector, and White House reassurances that Federal Reserve Chairman Jerome Powell and US Treasury Secretary Steven Mnuchin were not on the chopping block.
The Dow closed the day at 22,878, up more than 1,086 points to record its largest single-day gain in history. On a percentage basis, the Dow’s 4.98 percent daily move marked its best daily return in nearly a decade. The Nasdaq and S&P 500 achieved similar daily gains, notching their most impressive rallies since March 2009.
Thursday’s pre-market trading told a very different story, however, with Dow futures slipping more than 300 points, S&P 500 futures down 1.61 percent, and Nasdaq 100 futures sliding by 1.57 percent as traders struggled to forecast the choppy stock market’s near-term direction.
Following the opening bell, individual stocks getting battered included Viacom (4.1 percent), Conagra (3.1 percent), Campbell Soup Co. (2.9 percent), and American Airlines (2.9 percent). JD.com, meanwhile, rallied 3.5 percent in response to a report that the China-based internet giant will undergo a significant makeover.
Many analysts argue that the Federal Reserve’s response to the recent market correction could be key in determining whether stocks make a recovery during the first quarter of 2019.