Consumer Sentiment, Affirm Earnings, Robinhood Stock: 3 Things to Watch By

© Reuters.

By Liz Moyer

-- U.S. stocks stumbled on Thursday yet again, on lingering concerns that inflation pressures will force the Federal Reserve to act more aggressively on interest rates.

The catalyst was the producer price index for April, which showed inflation for companies rising again though at a lower rate than in previous months. While that could mean the pressure is abating, it is still at elevated levels.

Analysts are weighing whether that will influence the Fed’s decision on interest rates when it meets again next month. The consensus is for a half-point increase, but there are some who see the potential for an even bigger increase of 75 basis points. 

The selloff in tech stocks also has weighed on the broader market. Apple Inc (NASDAQ:AAPL) fell another 3% on Thursday after a 5% drop on Wednesday and lost its crown as the most valuable company to Aramco (TADAWUL:2222), the Saudi oil major. Still, the Nasdaq managed to erase losses on Thursday to close up slightly in the green.

Apple and other tech giants such as Alphabet (NASDAQ:GOOGL), Netflix Inc (NASDAQ:NFLX) and Facebook’s Meta Platforms Inc (NASDAQ:FB) had led the market higher until this recent swoon.

Cryptocurrencies are another focus after crashing lower on weakness in stablecoins. Bitcoin, the biggest digital currency, is now below $30,000 at around $28,000, less than half its peak price from last November.

Here are three things that could affect markets tomorrow:

1. Consumer sentiment

At 10:00 AM ET, Michigan’s consumer sentiment reading for May comes out, expected to be 64, down slightly from the 65.2 recorded in April as households battle rising food and gasoline prices that are forcing them to make compromises in their spending.

2. Affirm earnings

The buy-now-pay-later company Affirm Holdings Inc (NASDAQ:AFRM) has been one of the hottest fintechs around, but its shares are down 60% this year after a much-anticipated initial public offering last year. Its earnings report late Thursday lit the stock on fire, up 19% in aftermarket trading after beating expectations on both the top and bottom line.

3. Robinhood stock

Shares of Robinhood Markets Inc (NASDAQ:HOOD) jumped 25% in after-hours trading after a regulatory filing said Sam Bankman-Fried, the CEO of cryptocurrency exchange FTX, has acquired a 7.6% stake.

 

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