Investing.com– U.S. stocks traded in a mixed fashion Friday, with investors digesting a fluid situation in the Middle East, while disappointing guidance from streaming giant Netflix (NASDAQ:NFLX) weighed on the tech sector.
At 09:45 ET (13:45 GMT), Dow Jones Industrial Average rose 145 points or 0.4%, S&P 500 rose 5 points, or 0.1%, while NASDAQ Composite fell 45 points, or 0.3%.
Sentiment weakened early Friday after Israel’s reported missile strike on Iran earlier Friday, escalated tensions in the region and raised the possibility of continuing retaliation between the Middle East powers.
However, tensions have since lessened after Iranian news agencies said there was no damage to the country’s nuclear facilities, and the strikes have been seen to be rather limited in size.
“Markets will be monitoring today’s headlines very closely, trying to gauge the risk of the Iran-Israel tensions spiralling into a fully-fledged conflict in the region,” analysts at ING said, in a note.
Hawkish Fed signals continue, Bostic warns of rate hike
The main Wall Street indices are on course for weekly losses, with the broad-based S&P 500 seen down 2.2%, heading for its third straight negative week, and its worst since the end of October last year.
The main negative driver has been falling expectations of an interest rate cut by the Federal Reserve any time soon as U.S. economic data have proved resilient.
A slew of Fed officials, including Chair Jerome Powell, warned this week that rates were set to remain higher for longer in the face of sticky inflation.
Atlanta Fed President Raphael Bostic went as far as to say that the Fed could even hike interest rates this year if inflation did not ease as expected, although he still expected a single rate cut in 2024.
Bostic’s comments rattled an already fragile market, which was reeling from investors sharply pricing out their expectations for a June rate cut.
Netflix to stop reporting quarterly subscriber data
Also weighing on sentiment was a poorly received earnings report from Netflix, with the video streaming giant’s second-quarter revenue outlook missing expectations, raising concerns that slowing consumer spending could weigh on corporate earnings in the coming months.
Netflix also unexpectedly said it would stop reporting quarterly membership numbers and average revenue per membership starting next year with its Q1 2025 earnings, largely overshadowing a bumper first-quarter report, and prompting share price losses of over 7%.
Earnings season picks up
The first-quarter earnings season is set to pick up pace in the coming days, with market giants including Tesla (NASDAQ:TSLA), General Electric (NYSE:GE) and Meta Platforms (NASDAQ:META) set to report next week.
On Friday, Procter & Gamble (NYSE:PG) stock fell around 2% after the customer goods giant’s third-quarter net sales fell short of expectations even as raised its annual profit forecast as commodity costs fall.
American Express (NYSE:AXP) stock rose over 3% after the financial services giant’s first-quarter profit vaulted past estimates, driven by an affluent customer base that increased spending as recession fears ebbed on Friday.
Paramount Global (NASDAQ:PARA) stock soared almost 10% after the blockbuster sale of the entertainment giant to David Ellison’s Skydance Media may be at significant risk of falling short as Sony and Apollo Global Management (NYSE:APO) prepare to make “a significantly better offer that will benefit all shareholders of the company,” an insider told Investing.com exclusively.
Crude hands back early gains
Crude prices weakened Friday, handing back the early gains that followed reports of Israeli missiles striking Iran.
By 09:45 ET, the U.S. crude futures traded 0.1% lower at $82.69 a barrel, while the Brent contract dropped 0.1% to $87.00 per barrel.
The crude benchmarks had posted gains of around 3% earlier Friday after Iran’s Fars news agency said that explosions were heard at an airport in the Iranian city of Isafahan, while U.S. news outlet ABC News cited a U.S. official as saying that Israeli missiles had hit a site in Iran.
However, the strikes have since been seen as relatively limited, and gains were quickly sold into.
(Ambar Warrick contributed to this article.)
