Stock futures are flat after sell-off in growth and tech

Traders working on the New York Stock Exchange (NYSE) today, Wednesday, April 21, 2021.

Source: NYSE

US stock futures were unchanged in night trading on Tuesday after a session marked by major weakness in technology stocks.

Dow futures only rose 12 points. S&P 500 futures rose 0.05% and Nasdaq 100 futures fell 0.05%.

In after-hours trading, Activision Blizzard rose nearly 6%, T-Mobile 2.8% and ride-hail company Lyft 7% on better-than-expected earnings reports.

Investors left tech and growth stocks on Tuesday, pushing the Nasdaq Composite down 1.9%. Netflix shares lost 1.2% and Microsoft fell 1.6%. Amazon and Facebook lost 2.2% and 1.3%, respectively. Apple fell 3.5% and Alphabet 1.6%.

The S&P 500 erased Monday’s gains and fell 0.7%. The Dow Jones Industrial Average ended the day about 20 points after losing more than 300 points at one point on Tuesday.

The Russell 2000 small-cap benchmark fell 1.3%. Reopening games like airlines, casinos, and cruise lines also saw selling pressure.

There are a number of possible reasons for the downside pressure, including fears of rising inflation, concerns that the Federal Reserve may have to ease monetary stimulus sooner than telegraphed, and the potential for tax hikes in the coming months.

US stocks hit the lows of the day following Treasury Secretary Janet Yellen’s comments that interest rates may need to rise slightly to prevent the economy from overheating.

The winning season continues on Wednesday with reports from General Motors, Hilton Worldwide, Allstate and Etsy. While first quarter earnings were strong and companies raised their forecasts, stocks don’t always move higher after good news. Investors told CNBC this could mean the positive outlook is already priced into stocks.

Private payroll data is also released on Wednesday at 8:15 p.m. ET. Economists polled by Dow Jones expect 800,000 private jobs in April, compared with 517,000 in March, according to ADP. Those numbers are ahead of Friday’s closely watched job report.

Two key readings on the service sector will also be published on Wednesday morning.

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