US Stocks Expected to Open Higher Following Nasdaq 100 Correction

U.S. stock futures experienced an uptick on Friday, following a notable selloff on Thursday that moved the Nasdaq 100 index into what is termed the correction zone. In premarket trading, futures for all four major benchmark indices showed positive movement.

On Thursday, the administration of President Donald Trump decided to delay the implementation of certain tariffs on products imported from Mexico and Canada under the United States-Mexico-Canada Agreement (USMCA). This postponement came shortly after a 25% import levy was introduced earlier in the week.

Investors are now looking ahead to the upcoming U.S. jobs report, as well as data on the unemployment rate and hourly wages for February, which are expected to be released today.

In financial markets, the 10-year Treasury yield was noted at 4.26%, while the yield on two-year notes was recorded at 3.95%. Data from the CME Group's FedWatch tool indicates there is a 91% probability that the Federal Reserve will decide to keep interest rates steady in the upcoming March meeting.

Futures	Change (+/-)
Nasdaq 100	0.48%
S&P 500	0.30%
Dow Jones	0.15%
Russell 2000	0.19%

In the premarket on Friday, both the SPDR S&P 500 ETF Trust (SPY) and the Invesco QQQ Trust ETF (QQQ), which track the respective S&P 500 and Nasdaq 100 indices, posted gains. SPY increased by 0.33%, reaching a value of $574.58, while QQQ climbed 0.48% to $490.55, as per data from Benzinga Pro.

Cues From The Last Session

During Thursday's trading session, sectors such as real estate, information technology, and consumer discretionary recorded significant losses, contributing to the overall market decline. In contrast, energy stocks managed to rise amidst the general downturn.

On the economic side, the U.S. reported a record trade deficit of $131.4 billion in January compared to a revised $98.1 billion gap from the previous month. Additionally, unit labor costs in the nonfarm business sector increased by 2.2% in the fourth quarter, which was a departure from preliminary expectations of a 3% rise.

Initial jobless claims decreased by 21,000 from the previous week, totaling 221,000 for the last week of February, which was better than the market's expectations of 235,000.

Insights From Analysts

Market reactions to recent tariff announcements have been largely negative, but some experts suggest that this suspension could pave the way for a potential recovery in the markets over the medium term. Subho Moulik, the CEO of financial technology platform Appreciate, pointed out that despite ongoing concerns regarding inflation and trade uncertainties, the underlying U.S. economic indicators remain strong. With unemployment figures falling to 4% and GDP growth maintaining a positive trajectory, this resilience offers a solid foundation for market stabilization.

Moulik stated, "Although we may see continued market volatility in the short term, history shows that carefully navigating policy-induced corrections may benefit investors who keep a disciplined, long-term approach." He also noted that the Nasdaq 100 had entered correction territory on Thursday, having fallen 9.76% from its peak, reaching 20,052.64, and breaking below its 200-day moving average for the first time in nearly two years.

According to analyst Jason Goepfert from White Oak Consultancy LLC, a further decline of 3.5% in the Nasdaq 100 within the next two weeks could indicate the onset of a bear market. He cautioned that historically, similar circumstances have led to bearish conditions.

Looking ahead, key economic data will be published on Friday. Investors are set to receive the February U.S. jobs report, alongside updates on the unemployment rate and hourly wages, due for release by 8:30 a.m. ET.

Additionally, several Federal Reserve officials, including Governor Michelle Bowman, New York Fed President John Williams, and Fed Chairman Jerome Powell are scheduled to speak throughout the day. Furthermore, consumer credit data for January will be disclosed at 3:00 p.m. ET.

Stocks In Focus

• Algonquin Power & Utilities Corp. (AQN) experienced an increase of 1.21% in premarket trading ahead of its earnings announcement, expected to be released before the market opens. Analysts anticipate earnings of 8 cents per share on revenues of $607 million.
• Genesco Inc. (GCO) saw a slight decline of 0.15%, with Wall Street estimating quarterly earnings of $3.31 per share based on $784.85 million in revenue.
• Advantage Solutions Inc. (ADV) registered a notable rise of 5.51% ahead of its earnings report, which analysts predict will show earnings of 12 cents per share on $863.41 million in revenue.
• Broadcom Inc. (AVGO) surged 12.84% after reporting better-than-expected first-quarter results, noting expected revenues of around $14.9 billion for the upcoming quarter.
• JD.Com Inc. (JD) faced a decline of 1.98% despite surpassing earnings expectations; however, management did not provide clarity on their new food delivery venture.
• Costco Wholesale Corp. (COST) dropped 1.42% after reporting mixed second-quarter earnings while indicating preparedness to handle tariff impacts.
• Plus Therapeutics Inc. (PSTV) surged notably by 58.33%, having received Orphan Drug Designation from the FDA for a new treatment focused on lung cancer complications.

In other news, the global markets closed lower, with Asian indices including Australia's ASX 200 and Japan's Nikkei 225 experiencing declines, along with downward trends in European markets.

Overall, as the U.S. market grapples with correction trends, the outlook remains cautiously optimistic, as analysts anticipate potential market stabilization driven by resilient economic fundamentals.

Stocks, Market, Economy