U.S. stock futures fell on Friday as Wall Street headed for a week of big losses, and traders absorbed FedEx’s bleak earnings warning about the global economy.
Dow Jones industrial average futures were down 223 points, or 0.7%. S&P 500 and Nasdaq 100 futures were down 0.8% and 0.9%, respectively. On Thursday, the Dow fell 173 points, or 0.56%, to its lowest close since July 14.
Shares of FedEx fell 19% after the shipping company It withdrew its full-year guidance And he said he would implement cost-cutting measures to combat soft global export volumes as the global economy “deteriorated significantly”. Transportation stocks are generally seen as a leading economic indicator, so FedEx’s announcement could contribute to Friday’s broader decline.
“It’s very much a bellwether, certainly traditionally,” Silvercrest Asset Management’s Robert Teeter said on CNBC’s “Global Exchange.” “[But] I think one of the things we’ve seen in this pandemic and post-pandemic economy is that different sectors have different cycles.”
“No doubt, the news is not positive, and it’s certainly about the importance of margins going forward, which we think is a company based on the company’s output,” Dieter added.
The three major averages were on pace for a fourth losing week in five as a comeback rally looks like a bear market bounce. The Dow Jones Industrial Average is down 3.70% this week, while the S&P 500 is down 4.08%. The Nasdaq Composite fell 4.62%, heading for its worst weekly loss since June.
The big losses on Tuesday followed a surprisingly tepid reading in the August consumer price index report, with the Dow losing 1,200 points in its worst decline in two years.