5 Important Facts to Be Aware of Before the Stock Market Starts

Market Update: Stock Futures Slide as Volatile Month Ends

U.S. stock futures are trending lower this morning as investors prepare to close out a turbulent month. Paramount Skydance shares are climbing after the company secured a win in the competition to acquire Warner Bros. Discovery, while Netflix is also seeing gains after stepping back from the bidding process. Meanwhile, the latest Producer Price Index is anticipated to show that inflation eased in January. Nvidia remains under selling pressure following a sharp decline yesterday, despite reporting earnings that surpassed expectations. In contrast, Block shares are rallying after the company revealed plans for significant layoffs. Here’s a summary of today’s key developments.

Stocks Retreat as Investors Await Inflation Data

On Friday, futures for major U.S. indexes are in the red as traders look ahead to a crucial inflation report. Dow Jones Industrial Average futures have slipped 0.8%, while S&P 500 and Nasdaq futures are down 0.6%. The S&P 500 and Nasdaq both ended lower on Thursday, dragged down by a steep selloff in technology stocks, particularly Nvidia, despite its strong earnings. The Dow, however, managed a slight gain and is poised to notch its tenth straight month of advances. This month has seen significant volatility, largely driven by concerns around artificial intelligence. The S&P 500 and Nasdaq are on track for monthly losses.

Bitcoin has dropped sharply over the past month and is currently trading around $66,000, off from an overnight peak of $68,200. Gold futures have edged up to approximately $5,200 per ounce, and WTI crude oil, the U.S. benchmark, has risen 2.5% to $66.85 per barrel. The 10-year Treasury yield, which impacts various consumer loan rates, has fallen to 3.98%, down from 4.02% at the previous close and near its lowest point since November.

Paramount Skydance and Netflix Rally Amid Warner Bros. Discovery Deal

Paramount Skydance (PSKY) and Netflix (NFLX) shares are both surging after Paramount emerged as the successful bidder for Warner Bros. Discovery (WBD). The Warner Bros. Discovery board determined that Paramount’s $31 per share offer was more attractive than Netflix’s proposal. Although Warner Bros. Discovery had initially accepted Netflix’s bid, negotiations were reopened with Paramount last week. Netflix’s offer focused on acquiring Warner Bros. Discovery’s TV and film assets, while Paramount sought to purchase the entire company, including assets such as CNN. Netflix ultimately decided not to increase its bid. In premarket trading, both Netflix and Paramount Skydance shares were up roughly 8%, while Warner Bros. Discovery shares slipped by 1%.

Wholesale Inflation Expected to Ease in January

The Producer Price Index (PPI) report, scheduled for release at 8:30 a.m. ET, is forecast to indicate that wholesale inflation moderated last month. Economists polled by The Wall Street Journal and Dow Jones Newswires anticipate a 0.3% rise in January PPI, down from a 0.5% increase in December. The core PPI, which excludes volatile categories like food and energy, is projected to remain steady at 0.4%. This follows recent data showing consumer prices were 2.4% higher in January compared to a year earlier.

Nvidia Faces Continued Selling Despite Strong Results

Nvidia (NVDA) shares are under pressure again today after the company lost more than 5% in the previous session, even though it posted outstanding quarterly results. Nvidia reported a 73% jump in fourth-quarter revenue year-over-year, far exceeding analyst forecasts. The company’s data center segment, a key driver of its growth, reached a new record as major technology firms rushed to secure its AI chips. However, some investors remain cautious due to Nvidia’s reliance on a handful of large clients, and skepticism about the sustainability of the AI boom persists. Nvidia shares are currently down about 1%.

Block Shares Jump Following Major Workforce Reduction

Block (XYZ) stock is soaring after the payments company announced plans to cut 4,000 jobs, representing roughly 40% of its workforce. CEO Jack Dorsey explained that the layoffs are intended to boost efficiency through the adoption of AI tools. Dorsey stated, “I prefer to take decisive action now and rebuild from a position of strength, rather than gradually reduce staff over time.” Block’s shares surged 20% in premarket trading.