Dow futures were higher even after a losing week on Wall Street as investors ditched stocks on concerns about the new Omicron Covid variant and Federal Reserve measures to tighten monetary policy.
Futures contracts linked to the Dow Jones Industrial Average rose 244 points. S&P 500 futures were 0.44% higher. Nasdaq 100 futures floated around the flatline.
Nasdaq stock futures were the underperformers on Sunday after Bitcoin fell sharply over the weekend and investors continued to consider owning highly valued tech stocks.
The Dow and S&P 500 fell 0.17% and 0.84% respectively on Friday. The Nasdaq Composite was down 1.92%.
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Tesla was the biggest resistance for tech-heavy Nasdaq on Friday, with the electric vehicle maker's shares plummeting more than 6%.
Cathie Wood's flagship Ark Innovation Fund is down more than 5% and all but two stocks in the fund are in bear. Teladoc Health, Zoom Video, Roku, Palantir, and Twilio are some of the names that have seen heavy losses.
The strong sales of technology stocks extended to the crypto universe, where prices also fell. Bitcoin was trading at around $ 57,000 on Friday morning but had fallen to around $ 43,000 by Saturday. By Sunday, the world's largest cryptocurrency had made up some of its losses, but was still trading below the all-important $ 50,000 mark.
Slower-than-expected employment growth also added to Friday's broad-market sales. The number of non-farm employees rose 210,000 last month, the Department of Labor said on Friday, which was below the 573,000 economists expected by Dow Jones.
"Softer payroll pressures have pulled the carpet under risk sentiment," TD Securities wrote in a notice to clients on Friday. As investors fled to safety, the 10-year Treasury yield fell to 1.335%, its lowest level since September 21.
The unemployment rate was 4.2%, better than expected, after 4.6% in October. According to the Dow Jones, economists had forecast a value of 4.5%.
"The number of job gains is undoubtedly disappointing, especially when you consider that the survey period went back before we even knew the name of the newest variant of Covid-19," said Jeffrey Buchbinder, equity strategist at LPL Financial. "While Omicron may be cutting its hires a bit in the next month or two, we remain confident that we can expect strong job growth and above-average growth in the US economy in 2022," he added.
Friday sales ended a volatile week for major averages as investors assessed new information on the Omicron variant.
All three major averages ended the week in the red, with the Dow posting a fourth consecutive negative week for the first time since September 2020. The S&P and the Nasdaq Composite were both down for the second straight week.
Small-cap names have been hit particularly hard, with the Russell 2000 down 3.86% for the week.
"Despite our forecast for a flat year for the S&P 500 … we are still optimistic about the market segments, including small caps," Bank of America said in a statement to its customers on Friday. "Small caps are more domestic, more affected by the rebound in service spending, benefit more from investment / reshoring, and are cost effective compared to large caps," the company added.
However, Bank of America said the potential upside for small caps depends on the Covid cases being kept under control.
The Omicron variant has now been discovered in at least 15 US states, said CDC director Dr. Rochelle Walensky told ABC News on Sunday.
“We know we have several dozen cases and we're following them closely. And we're hearing more and more likely cases every day, so the number is likely to go up, ”she said in“ This Week ”.