US pre-open: Futures firmly in the red as earnings remain in focus

Wall Street futures were in the red ahead of the bell on Friday as investors continued to digest earnings.

As of 1215 BST, Dow Jones futures were down 0.28%, while S&P 500 and Nasdaq-100 futures had the indices opening 0.34% and 0.33% lower, respectively.

The Dow closed 524.29 points higher on Thursday, erasing losses recorded in the previous session as market participants thumbed over a number of big-name earnings reports and digested Q1 GDP data.

Corporate earnings were in focus ahead of the bell after e-commerce behemoth Amazon's first-quarter results beat expectations across the board, while Intel beat estimates on the top and bottom lines with its earnings, social media outfit Snap posted a revenue miss, and Pinterest issued a disappointing second-quarter revenue growth forecast.

Zaye Capital's Naeem Aslam said: "Traders know that the US economy is experiencing a difficult time, and it is pretty much a given that the Fed is going to increase the interest rate by another 25 basis points. This means that earnings are going to be adversely influenced further in the coming quarter, and the US economy will face further slowdown. Nonetheless, it is amazing to see that the US stock indices are still performing relatively well.

"We think that traders should continue to practise extreme caution in these markets, and the current market state gives them the best opportunity to hedge their risk, especially with the fact that the volatility index has dropped so much. It makes sense to buy the VIX now when it is sitting at its lowest point of the year and when we know that the US banking crisis is still here and the debt ceiling debate and worries are still a matter of concern."

On the macro front, March's PCE price index will be published at 1330 BST, as will personal income and spending figures, while April's Chicago PMI and a final reading of the University of Michigan's consumer sentiment index will follow at 1445 BST and 1500 BST, respectively.

Reporting by Iain Gilbert at Sharecast.com