Wall Street headed for lower open on heels of tech selloff

The Associated Press

NEW YORK (AP) — Wall Street was headed for a lower open Friday, one day after a historic plunge in the stock price of Facebook’s parent company yanked other tech stocks lower on Wall Street.

Futures for the S&P 500 was flat, while the contract for Dow Jones Industrial futures edged down 0.4%.

Wall Street’s major indexes are still on track for weekly gains, helped by strong earnings reports from companies like Apple, Exxon, UPS and Google’s parent Alphabet.

Investors are also awaiting an update on the U.S. employment situation with the Labor Department’s January jobs report coming Friday. Fresh inflation data are due next week.

Last month’s huge wave of omicron infections is thought to have weakened hiring in January, though the pullback is considered all but sure to prove a temporary one.

Economists surveyed by FactSet have forecast that the Labor Department will report that employers added just 170,000 jobs last month, according to data provider FactSet. If the forecast is accurate, January would mark the lowest monthly job gain in about a year.

In London, the FTSE 100 was flat, while the CAC 40 in Paris declined 0.9%. Germany’s DAX gave up early gains, falling 1.4%.

In Asia on Friday, Hong Kong’s Hang Seng rose 3.2%, while the Nikkei 225 in Tokyo added 0.7%. In Sydney, the S&P/ASX 200 reversed early losses to gain 0.6%. India’s benchmark Sensex lost 0.2%.

In other trading, U.S. benchmark crude oil picked up $1.86 to $92.13 per barrel after surging $2.01 to $90.27 per barrel on Thursday.

Brent crude, the basis for pricing international oils, gained $1.80 cents to $92.91 per barrel.

The U.S. dollar slipped to 114.81 Japanese yen from 114.96 yen late Thursday. The euro was at $1.1478, up from $1.1437.

On Thursday, the S&P 500 fell 2.4%, its biggest drop in nearly a year, weighed down by the the 26.4% wipeout in Meta Platforms, as Facebook’s owner is now known. It erased more than $230 billion in market value, easily the biggest one-day loss in history for a U.S. company. The stocks of other social media companies including Twitter and Snap also fell.

The Dow industrials lost 1.5% and the tech-focused Nasdaq composite gave up 3.7%, its biggest loss since September 2020. The Russell 2000 index of small caps lost 1.9%.

The retreat ended a four-day winning streak for the market.

Big technology and communications companies played a big role in driving gains for the broader market throughout the pandemic and much of the recovery in 2021. But investors have been shifting money in expectation of rising interest rates, which make shares in high-flying tech companies and other expensive growth stocks relatively less attractive.

The Federal Reserve is planning its first interest rate hike in March, aiming to tamp down inflation that has surged to 40-year highs. Those higher costs will likely persist until supply chains loosen and help ease costs for businesses and perhaps lower prices for consumers.