Dow Futures Down 275 Pts; Bed Bath & Beyond Plummets

By Peter Nurse

Investing.com -- U.S. stocks are seen opening lower Friday, ending the week on a negative note as investors reassess the extent of future interest rate hikes.

At 07:00 ET (11:00 GMT), the Dow Futures contract was down 275 points or 0.8%, S&P 500 Futures traded 45 points or 1% lower, and Nasdaq 100 Futures dropped 160 points or 1.2%.

The main Wall Street indices closed marginally higher Thursday, with the blue-chip Dow Jones Industrial Average ending just 18 points, or 0.1%, higher, as the retail sector continued to dominate the spotlight.

Global equity funds received inflows for a second straight week in the week to Aug. 17, with data from Refinitiv Lipper showing that these funds attracted a net $3.22 billion worth of purchases, a 19% increase in inflows over the previous week.

However, following on from the minutes of the July Federal Reserve meeting indicating that Fed officials saw "little evidence" that U.S. inflation pressures were easing, a number of policymakers pushed back during Thursday’s session against bets on rate cuts next year.

Next week’s Federal Reserve Jackson Hole symposium is now eagerly awaited, with Chair Jerome Powell expected to lay out a hawkish view on the dangers of inflation.

The results from the retail sector have been mixed, with the likes of Walmart (NYSE:WMT) and BJ's Wholesale (NYSE:BJ) reporting strong sales in their grocery businesses, while others such as Target (NYSE:TGT) and Kohl's (NYSE:KSS) citing inflationary pressure on shoppers for disappointing numbers.

There are more earnings Friday, with Deere & Co. (NYSE:DE) reporting a rise in quarterly profit as higher equipment demand helped the world's largest farm equipment maker to offset inflationary cost pressures.

Numbers are also expected from athletic apparel retailer Foot Locker (NYSE:FL) as well as Newcrest Mining (TSX:NCM) of Canada, while semiconductor equipment company Applied Materials (NASDAQ:AMAT) released a better-than-expected earnings report and upbeat outlook after the close Thursday.

The woes of Bed Bath & Beyond (NASDAQ:BBBY) are also likely to remain of interest, with the former meme favorite stock seen over 40% lower premarket Friday a day after the billionaire investor Ryan Cohen disclosed he had sold his 9.8% stake in the struggling home goods retailer.

Oil prices fell Friday, on course for a weekly loss despite a two-day rally midweek, as concerns over a global slowdown dampening demand for crude continue to hold sway.

Data released on Wednesday showing that U.S. crude inventories fell sharply last week helped reassure traders that U.S. demand was holding up despite the high price levels, but lingering recession fears and a possible increase in output by Iran have turned the market negative.

By 07:00 ET, U.S. crude futures traded 1.9% lower at $88.78 a barrel, while the Brent contract fell 1.9% to $94.72. Both benchmark contracts were headed for weekly losses of over 3%.

Additionally, gold futures fell 0.4% to $1,763.95/oz, while EUR/USD traded 0.3% lower at 1.0060.