U.S. stock futures fell Thursday after tech juggernaut Meta Platforms reported quarterly results that disappointed investors.
Futures tied to the Dow Jones Industrial Average fell 207 points or 0.5%. S&P 500 futures slid 0.7%, and Nasdaq 100 futures dropped 1%.
Meta plunged 12% in premarket trading after the social media giant issued light revenue guidance for the second quarter. That would be the stock's biggest one-day decline since October 2022. International Business Machines also fell 8% after missing consensus estimates for first-quarter revenue.
Meta's report raises concern ahead of other big tech releases. Microsoft and Alphabet are slated to post earnings after the close Thursday.
Traders will watch out for the first-quarter reading of the U.S. gross domestic product, due at 8:30 a.m. ET Thursday. Economists polled by Dow Jones expect that real GDP came in at 2.4%. Weekly jobless claims are also due.
These data points will inform the central bank's path forward on interest rate policy. Fed funds futures trading suggests the first cut could take place at the September Fed meeting, according to CME FedWatch Tool.
Nevertheless, iCapital chief investment strategist Anastasia Amoroso thinks that earnings look strong enough to boost stocks.
"Even if the Fed does stand pat, I think this could be a supportive environment for stocks," she said on CNBC's "Closing Bell" on Wednesday afternoon. "Return expectations for investors have actually improved since the beginning of April."
Airlines Southwest and American diverged in premarket trading as investors reacted to their first-quarter earnings reports.
Southwest dropped more than 7% after missing Wall Street expectations on both lines. It saw 36 cents in adjusted losses per share on $6.33 billion in revenue, while analysts surveyed by LSEG forecast a loss of just 34 cents and revenue at $6.42 billion.
Southwest warned that delays from Boeing could hurt its growth into 2025.
On the other hand, American added more than 4%. Despite also coming in below analysts' forecasts on both lines, investors appeared focused on stronger-than-anticipated guidance for the current quarter.
American posted an adjusted loss of 34 cents on revenue of $12.57 billion for the first quarter. That is under the consensus estimates from analysts surveyed by LSEG of a 29 cent loss and $12.6 billion in revenue.
— Alex Harring, Leslie Josephs
Honeywell rose in premarket trading after reporting its financial results for the latest quarter.
The industrial firm posted earnings per share of $2.25, beating analysts' estimates of $2.17, according to LSEG. Revenue for the quarter came in at $9.11 billion, compared to the $9.03 billion analysts were expecting.
Shares were last higher by 1.8%.
— Tanaya Macheel
Merck shares climbed nearly 2% before the bell on Thursday as first-quarter earnings came in ahead of expectations.
The pharmaceutical giant earned an adjusted $2.07 per share on $15.78 billion in revenue. Analysts surveyed by LSEG anticipated just $1.88 in earnings per share and $15.2 billion in revenue.
Merck was aided in the period by strong sales of its vaccination products and Keytruda cancer drug. Shares of the stock, which is part of the Dow, have jumped more than 16% in 2024.
— Alex Harring, Annika Kim Constantino
Chipotle Mexican Grill shares jumped 3.2% during Thursday premarket trading on the back of a better-than-expected quarterly print.
The burrito chain on Wednesday reported first-quarter earnings and revenue that surpassed analysts' expectations, fueled by higher traffic to its restaurants. Earnings per share came out at $13.37, excluding items, while analysts polled by LSEG had called for $11.68 per share. Chipotle posted $2.7 billion in revenue, exceeding the consensus estimate of $2.68 billion.
Chipotle saw traffic growth across income groups during the quarter, CEO Brian Niccol said. Customers have continued to flock to the restaurant chain even after it raised its prices in October, citing inflation.
For more on Chipotle's earnings, read here.
— Pia Singh
European stocks opened slightly higher Wednesday, with the benchmark Stoxx 600 index down 0.2% by 8:15 a.m. London time.
The U.K.'s FTSE 100 climbed 0.5% after it snapped a five-day winning streak on Thursday, while France's CAC 40 was 0.2% lower, and Germany's DAX was down 0.5%.
— Karen Gilchrist
Japan's Nikkei 225 index fell 2.1% in afternoon trading, while the broader Topix index dropped 1.64%.
The benchmark Nikkei 225 has fallen 8.3% from a record high hit in late March.
Investors are waiting for the Bank of Japan's monetary policy decision on Friday. It will be closely watched for inflation outlook against a backdrop of a weakening yen, higher oil prices and strong wage growth.
The yen slipped past 155 against the U.S. dollar on Thursday, touching a new 34-year low.
— Shreyashi Sanyal
Shares of South Korean chipmaker SK Hynix slid almost 3% despite the company posting its highest operating profit in almost two years.
The chipmaker recorded 2.89 trillion South Korean won ($2.1 billion) in operating profit for the first quarter of 2024, a 734% jump year on year, with net profit coming in at 1.92 trillion won.
Revenue for the fourth quarter came in at 12.43 trillion won, an all-time quarterly high.
SK Hynix explained that this was due to an increase in the sales of AI server products, "backed by its leadership in AI memory technology."
The company also added that it "believes that it has entered the phase of a clear rebound, following a prolonged downturn."
— Lim Hui Jie
South Korea posted GDP growth of 3.4% in the first quarter, beating the 2.4% expected by economists polled by Reuters and marking its highest quarterly growth since the fourth quarter of 2021.
On a quarter-on-quarter basis, GDP rose 1.3%, also beating Reuters expectations of 0.6%.
Exports from South Korea in the first quarter rose 0.9%, as exports of IT items, such as cellular phones, increased. Imports contracted 0.7%, owing to decreased imports of electronic equipment.
— Lim Hui Jie
iCapital chief investment strategist Anastasia Amoroso believes there is a good chance the S&P 500 could rise to 5,500 by year's end.
The broader market index closed at 5,071.63 on Wednesday afternoon. This target would mark an 8% increase for the benchmark.
"I think investors are getting another entry point here that's quite attractive," she said on CNBC's "Closing Bell" on Wednesday afternoon. Amoroso specifically highlighted semiconductor stocks for their potential to outperform going forward.
As catalysts for an encouraging equities backdrop, the strategist cited strong corporate earnings and consumer spending, alongside a pickup in global manufacturing momentum.
— Lisa Kailai Han
Here are the stocks moving the most in extended trading hours:
— Lisa Kailai Han
Stock futures opened lower Wednesday night.
Dow futures slipped around 0.3% shortly after 6 p.m. ET. S&P 500 futures lost 0.7%, while Nasdaq 100 futures fell nearly 1.2%.
— Lisa Kailai Han