Wall Street’s primary indices appeared set for a neutral start on Friday as initial concerns regarding an escalation in the Middle East eased, while Netflix stumbled after projecting current-quarter revenue below expectations.
Explosions reverberated across an Iranian city on Friday following what sources described as an Israeli attack. However, Tehran downplayed the incident, signaling no plans for retaliation—a move seemingly aimed at preventing a broader conflict in the region.
“After the details were disclosed, the markets experienced relief, and as evident, the markets are recovering from their earlier lows,” remarked Peter Cardillo, chief market economist at Spartan Capital Securities.
“While the conflict remains a worry for the market, earnings carry more fundamental weight than geopolitical concerns.”
Netflix saw a 6.4% drop in premarket trading following the streaming giant’s tepid second-quarter forecast. Meanwhile, shares of other streaming service providers like Walt Disney and Roku dipped by 0.7% and 1.2%, respectively.
Thursday saw the S&P 500 and Nasdaq register their fifth consecutive session of losses, driven by economic data and remarks from Fed officials indicating the central bank’s reluctance to cut interest rates in the near term.
Federal Reserve policymakers have gravitated toward maintaining borrowing costs at current levels until possibly later in the year, given sluggish progress on inflation and the enduring strength of the U.S. economy.
This week, equities were unsettled as investors recalibrated their expectations regarding the extent of Fed rate cuts this year.
Both the S&P 500 and Dow Jones Industrial Average were poised for a third consecutive weekly decline, while the Nasdaq looked set for its fourth straight weekly loss, should the current trend persist.
