Friday's market will be fixated on tech stocks and oil prices, but could get a jolt of volatility from an options and futures expiration that occurs once a quarter.
Tech stocks fell sharply Thursday morning, but cut losses throughout the day. Still, the Nasdaq ended down a half percent.
"The fact the tech stocks selling was less intense helped," said Art Cashin, director of floor operations at UBS. "That's what's calling the tune [for Friday]."
He said the tech sell-off, which started up again Wednesday after taking a pause, was discouraging to traders. "They thought it was going to be a very short occurrence."
A high-profile casualty of the tech sell-off was Snap, trading down nearly five percent and closing just on its $17 per share IPO price. Traders will be watching to see if it breaks that level Friday. FANG tech stocks remained under pressure Wednesday but also recovered from steeper losses. Amazon.com ended down 1.3 percent and Facebook, off 0.3 percent.
Oil could also be a factor in Friday's trading, especially if it heads toward $40 per barrel, a level considered too low for most U.S. shale drillers to make money. On Thursday, crude futures slid to a fresh 7-month low, with West Texas Intermediate futures settling at $44.46, off 27 cents, and just below the key psychological $45 per barrel level.
"I just think people are discouraged in energy. There's no way of seeing how it trades higher," said Steve Massocca, managing director with Wedbush Securities. "We're getting to where the guys in the Permian Basin aren't going to make money at this price."
He said oil may be at a low now, but the catalyst for a move higher is unclear.
The S&P energy sector was down 0.7 percent Thursday. "A lot of stocks that I'm involved with seem to be very correlated to oil, and they have nothing to do with oil," Massocca said, noting some shipping and logistics stocks were moving lower. "Anything that even sniffs of oil is getting hit pretty good today." He pointed to Western Refining Logistics and PBF Logistics.