Traders on the floor of the New York Stock Exchange.
US stock index futures changed little during Sunday’s overnight trading after the S&P 500 posted its second consecutive negative week.
Futures contracts linked to the Dow Jones Industrial Average gained 44 points. The S&P 500 futures were unchanged while the Nasdaq 100 futures fell 0.15%.
Stocks have had a mixed week, with the Dow posting its fourth negative week in five while the S&P posted two consecutive losses for the first time since February. The Nasdaq Composite was up 0.31% last week and lost for four weeks.
Despite the tech-heavy index’s weekly gain, the Nasdaq Composite ended its session in the red on Friday as bitcoin prices fell again, putting pressure on the broader tech sector.
The cryptocurrency sell-off continued on Sunday, and Bitcoin fell 16% to below $ 32,000, according to Coin Metrics. Bitcoin prices fell to just over $ 30,000 on Wednesday, falling to their lowest level since late January.
“The rapid rise in the value of digital currencies has seen a great surge in speed this week as cryptocurrencies of all kinds have plummeted,” CIBC strategists wrote in a message to customers. “The asset class continues to be very volatile, with the potential for significant price movement resulting from a single tweet or public comment.”
The decline came when Chinese regulators demanded stricter laws on mining and trading cryptocurrency.
“Despite the collapse of the crypto markets this week and the more Hawkish FOMC protocols, another stock slump has been bought by investors,” JPMorgan wrote in a statement to clients. “That ‘buy the dip” mentality has been remarkably strong this year and has provided a support that prevents small corrections in equity and risk markets from expanding further, “the company added.
The Federal Reserved indicated at its April meeting that a simple monetary policy could be rethought if the economy continues to show signs of rapid improvement, according to the minutes of the meeting released last week.
Looking ahead, there will be a number of retail companies that will post quarterly results in the coming week, including Nordstrom, Urban Outfitters, Gap, and Ulta. Several tech companies will also be releasing quarterly updates, including Nvidia, Snowflake, Workday, and Salesforce. In terms of economic data, consumer confidence and new home sales data will be released on Tuesday.
Heading into the last full week of trading of the month, the Dow is on track to turn a profit for May while the S&P is on track to turn a three-month winning streak. The Nasdaq Composite, which is down more than 3% for the month, is well on its way to achieving its longest monthly profit streak since January 2018, with its first negative month in seven years.
After outperforming this year to date, small caps have seen recent weakness and the Russell 2000 is well on its way to a seven month winning streak.
“We believe the choppy / sideways trend will last a little longer and the market will experience sell-off fears along the way,” noted Adam Crisafulli, founder of Vital Knowledge. “While stocks have so far absorbed many changes well, all turning points have to be played out for longer.”
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– CNBC’s Michael Bloom contributed to the coverage.