U.S. Stocks May See Further Downside In Early Trading

After ending the previous session mostly lower, stocks may see further downside in early trading on Thursday. The major index futures are currently pointing to a lower open for the markets, with the Dow futures showing a notable decline.

A steep drop by shares of Salesforce (CRM) is likely to weigh on the Dow, as the cloud-based software company is plunging by 16.5 percent in pre-market trading.

Salesforce is under pressure after reporting weaker than expected fiscal first quarter revenues and providing disappointing fiscal second quarter guidance.

Concerns about the outlook for interest rates may also continue to weigh on the markets, although a pullback by treasury yields may help keep selling pressure somewhat subdued.

The futures regained some ground following the release of separate reports showing an uptick by weekly jobless claims and slower than previously GDP growth in the first quarter.

The Labor Department said initial jobless claims rose to 219,000 in the week ended May 25th, an increase of 3,000 from the previous week’s revised level of 216,000.

Economists had expected jobless claims to inch up to 218,000 from the 215,000 originally reported for the previous week.

Meanwhile, the Commerce Department said gross domestic product climbed by 1.3 percent in the first quarter compared to the previously reported 1.6 percent jump.

The downwardly revised increase, which was in line with economists, compares to the 3.4 percent surge in GDP in the fourth quarter of 2023.

Not long after the start of trading, the National Association of Realtors is scheduled to release its report on pending home sales in the month of April. Pending home sales are expected to decrease by 0.6 percent in April after surging by 3.4 percent in March.

Following the mixed performance seen during Tuesday’s session, the major U.S. stock indexes all moved to the downside during trading on Wednesday. The Dow showed a notable decline, falling to its lowest closing level in almost a month.

The major averages all finished the day firmly in negative territory. The Dow slumped 411.32 points or 1.1 percent to 38,441.54, the S&P 500 slid 39.09 points or 0.7 percent to 5,266.95 and the Nasdaq fell 99.30 points or 0.6 percent to 16,920.58.

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Thursday. Japan’s Nikkei 225 Index and Hong Kong’s Hang Seng Index both tumbled by 1.3 percent, while China’s Shanghai Composite Index decreased by 0.6 percent.

Meanwhile, the major European markets have moved to the upside on the day. While the U.K.’s FTSE 100 Index has risen by 0.4 percent, the French CAC 40 Index is up by 0.3 percent and the German DAX Index is up by 0.1 percent.

In commodities trading, crude oil futures are slipping $0.24 to $78.99 a barrel after falling $0.60 to $79.23 a barrel on Wednesday. Meanwhile, after sliding $15.20 to $2,364.10 an ounce in the previous session, gold futures are inching up $1.50 to $2,342.70 an ounce.

On the currency front, the U.S. dollar is trading at 156.63 yen versus the 157.64 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.0827 compared to yesterday’s $1.0801.

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