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Wall St set for subdued open after previous session's jump; earnings in focus
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Wall St set for subdued open after previous session's jump; earnings in focus
Jan 23, 2025 6:22 AM

By Johann M Cherian and Sukriti Gupta

(Reuters) - U.S. main stock indexes were set for a subdued start on Thursday, as investors paused after Wall Street's strong performance in the previous session and focused on corporate earnings, economic data and President Donald Trump's remarks - all lined up through the day.

At 8:52 a.m. ET, Dow E-minis were up 45 points, or 0.10%, S&P 500 E-minis were down 5.25 points, or 0.09% and Nasdaq 100 E-minis were down 97.5 points, or 0.44%.

The S&P 500 and the blue-chip Dow logged their sixth session of advances out of seven on Wednesday, with the benchmark index notching an intraday record high for the first time in over a month.

Trump's announcement of half a trillion investment in artificial intelligence infrastructure, along with Netflix's strong results, provided the latest tailwind for markets, which had been recovering since last week after data showed underlying inflation was cooling despite robust economic activity.

In premarket trading, AI darlings Nvidia dropped 1.6% and Microsoft dipped 0.6%, while chip stocks such as Advanced Micro Devices and Broadcom slipped 1% each. The stocks had advanced in the previous session.

"The market probably needs a couple of days to digest the flurry of news that we're getting out of the Trump administration, with respect to his plans on tariffs and his economic policies to try and sort out the economic impacts of some of the executive actions that he's taken," said Scott Ladner, chief investment officer at Horizon Investments.

Uncertainty about Trump's trade plans prevailed as he said tariffs on imports from Canada, Mexico, China and the European Union could be announced on Feb. 1, although analysts expect April 1 to be the date when major tariff plans will be unveiled.

All eyes will be on Trump's virtual appearance at the World Economic Forum in Davos at 11:00 a.m. ET.

Trump pulled the U.S. out of the OECD tax deal on Monday. Tariff imposition could threaten a global trade war, upside price pressures and slow down the Federal Reserve's pace of monetary policy easing.

Traders expect the central bank to leave interest rates unchanged for the first half of 2025, according to data compiled by LSEG. A moderate rise in longer-dated Treasury yields also limited gains among stocks.

On the economic data front, a Labor Department report showed weekly jobless claims stood at 223,000, compared with expectations of 220,000.

Among top movers, GE Aerospace advanced 7% after it forecast 2025 profit above estimates on robust aftermarket demand.

Elevance rose 4.4% after beating estimates for fourth-quarter profit, partly helped by lower-than-expected spending on medical care for its members.

Other health insurers such as UnitedHealth Group, CVS Health and Humana rose between 1.4% and 2.4%.

American Airlines lost 5.2% after it forecast 2025 profit below expectations.

Electronic Arts was down 16.5% after the videogame publisher cut its forecast for annual bookings, citing weakness in its established soccer franchise.

Micron dropped 3.4% after South Korean rival SK Hynix warned of steeper demand declines in its commodity memory chips used in smartphones and computers.

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