Stock futures flat as Wall Street takes a breather after Dow’s 400-point rally

Another stock drop is coming, says Bernstein

Bernstein strategists led by Sarah McCarthy said they expect the market to drop another short leg.

“While the longer-term sentiment indicators are bearish enough to have a positive view on equities on a 12-month horizon, in the short term we believe the market is likely to have another leg down as we are only at the beginning of the earnings downgrade cycle, and we have yet to see any significant outflows from equity funds,” they said in a note to clients on Thursday.

The comments come as the market is enjoying a sharp rebound from the mid-June lows. Since then, the S&P 500 is up 14.25%.

Stock futures were little changed after Wednesday’s monster rally

U.S. stock futures pointed to a muted open on Thursday as the market took a break from a rally in the previous session. Futures tied to the Dow Jones Industrial Average rose less than 0.1%, along with S&P 500 and Nasdaq 100 futures.

Fred Imbert

Muted European markets; Big Bank of England hike expected

European stocks were subdued on Thursday as uncertainty returned after the previous session’s gains.

The pan-European Stoxx 600 was up 0.2% by mid-morning. Retail stocks were the best performers, gaining 2.2%, while telecommunications fell 0.5%.

Britain’s FTSE fell ahead of the Bank of England’s monetary policy decision later on Thursday. The central bank is expected to raise interest rates by 50 basis points, its biggest increase since 1995.

Alibaba shares in Hong Kong gain 4% before earnings

Alibaba is expected to report its fiscal first quarter results before the market opens and analysts expect the Chinese e-commerce giant to post its first-ever revenue drop.

Alibaba is expected to post revenue of 203.19 billion yuan ($30 billion) for the June quarter, down 1.2% from a year ago, according to Refinitiv’s consensus forecast.

Alibaba has faced a number of headwinds, from a tighter regulatory environment in China to a Covid resurgence in the world’s second-largest economy that has led to major cities being locked down. These factors have hit the Chinese economy, dampening advertising budgets and consumer spending, which will likely weigh on Alibaba’s June quarter results.

Still, analysts expect the company to return to growth in the coming quarters. Hong Kong-listed shares of Alibaba rose more than 4% before earnings.

—Arjun Kharpal

Jim Cramer Says Charts Point to Gold Rally

CNBC’s Jim Cramer said now is a good time to buy gold as signs point to a recovery, according to analysis by commodities trader Larry Williams.

The “Mad Money” host explained Williams’ analysis by looking at weekly gold action from 2014 and data on the positioning of small speculators in gold from the Commitments of Traders report. Commodity Futures Trading Commission.

Gold prices typically peak shortly after small speculators get too bullish on the precious metal, and bottom when small speculators are too bearish, according to Williams.

“The charts, as interpreted by the legendary Larry Williams, suggest that the general public is massively abandoning gold and they believe this makes it the perfect time to buy,” Cramer said.

—Abigail Ng, Krystal Hur

Here’s how to invest for returns to beat a bad year for stocks and bonds – according to the pros

Stocks are volatile and bonds haven’t fared any better for much of this year, with US investment grade bonds tumbling in 2022.

But analysts have recently been bullish on income investing as yields start to climb again.

Here are some ways the pros suggest investors position their portfolios for diversification and protection against market volatility as well as seek higher returns as inflation continues to rise. Pro subscribers can read the story here.

—Weizhen Tan

Fortinet shares fall

Fortinet shares fell more than 9% in extended trading after the cybersecurity company released its quarterly results, which included free cash flow of $283.5 million, compared to FactSet estimates of 337, $2 million. Services revenue also missed the estimates.

Other cybersecurity stocks also fell after hours. CrowdStrike was down slightly by 1% and Palo Alto Networks was down more than 1%.

—Tanaya Macheel

Walmart lays off, about a week after its profit warning

Walmart began laying off company employees about a week after the retail giant slashed its profit outlook and warned of a pullback in consumer discretionary spending due to inflation. The company described the layoffs as a way to “better position the company for a strong future” in a statement to CNBC. The shares fell slightly less than 1% after hours.

—Tanaya Macheel

Lucid shares fall nearly 12%

Shares of luxury electric vehicle maker Lucid Group fell 11.7% in extended trading after the company slashed full-year production targets for the second time to 6,000. The original forecast was for 20 000. The company also reported a quarterly loss of 33 cents per share.

—Tanaya Macheel

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