Stock market futures in the US fell sharply on Wednesday morning following disappointing quarterly financial results from Microsoft. The value of Dow Jones futures fell 0.20%, S&P 500 futures fell 0.37%, and Nasdaq futures fell 0.65%.
During the week, much awaited by operators, a series of data on the US economic front is arriving. On Tuesday, the initial January PMI was revealed for both Markit’s Manufacturing and Services.
Then on Thursday, the Commerce Department will release its fourth-quarter GDP estimates, along with the Labor Department’s weekly jobless claims and December new home sales data from the Census Bureau.
To wrap up the week, the Commerce Department’s PCE Price Index will report inflation data on Friday.
According to preliminary estimates, the S&P Global US Manufacturing PMI rose to 46.8 in January 2023 from 46.2 in December, topping the expected reading of 46.
However, the figure pointed to another decline in industrial activity, the second biggest since May 2020, as manufacturing demand remained weak. Production fell behind a significant drop in new orders, with companies emphasizing the influence of rising costs on customer demand.
The rate of decline in new orders was the second fastest in more than two-and-a-half years, and companies have been shedding staff for the first time since July 2020.
In addition, input costs have increased faster, ending a sequence of cost inflation moderation that began in mid-2022, and producer prices have also increased.
Meanwhile, Microsoft delivered better-than-expected earnings on robust cloud computing expansion yet provided a dim outlook. MSFT shares rose significantly Tuesday night but fell before the market opened Wednesday.
With China still closed for the Lunar New Year, there were positive signs in other Asian markets Wednesday morning, with the Nikkei up 0.35%, South Korea posting a 1.3% increase % and Singapore by 1.65%. During the day, the Asian market hit its highest level in seven months.
US stocks closed on parity on Wednesday: the S&P 500 lost 0.018% to 4,016.22, the Dow Jones rose 0.029% to 33,743.84, and the Nasdaq fell 0.18% to 11,313.36 .
The yield on the 10-year Treasury fell four basis points to 3.43% on Wednesday. Oil prices held steady, but natural gas prices tumbled 5% to reach their lowest since mid-2021.