Stock futures slip as Wall Street wraps up first week of second-quarter earnings

Futures contracts pegged to US stock indices slipped during Thursday night’s night session as Wall Street neared the end of the first big week of earnings reports for the second quarter.

Contracts linked to the S&P 500 lost 0.1%, while Dow futures lost 32 points. Nasdaq 100 futures lost less than 0.1%.

The movements in the overnight session came as investors pondered the first earnings reports for the second quarter released earlier in the week.

Although some of the country’s largest lenders posted healthy profits and revenues amid the economic recovery, the stock market reaction was far from rosy. Morgan Stanley’s earnings report for the second quarter, for example, exceeded analyst expectations on Thursday, but stocks closed just 0.18% higher.

For the 18 S&P 500 companies that beat analysts’ estimates for second-quarter earnings this week, average earnings per share were 18% higher than expected. But these companies saw their stocks decline an average of 0.58%, according to the report.

The subdued moves in response to corporate earnings contributed to an equally lackluster week for the S&P 500, which has fallen 0.2% so far this week.

Much of the market’s upward pressure over the past week has come from a handful of mega-capped internet and communications stocks. Apple is up 2.3% since the start of the week, while Netflix, Alphabet, and Microsoft are all up at least 1.1%.

Wall Street may curb its optimism following the latest hot consumer price index inflation report and comments from both Federal Reserve Chairman Jerome Powell and Treasury Secretary Janet Yellen about the pace of price increases.

Yellen, who spoke to CNBC’s “Closing Bell” Thursday, said she forecast prices could continue to rise for a few more months before cooling off.

“I’m not saying this is a month-long phenomenon. But I think in the medium term we will see inflation return to normal levels,” she said. “But of course we have to keep an eye on that.”

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