Stock futures drift sideways after rally

U.S. stocks were mostly higher Friday to build on gains from an up day on Wall Street that saw all three major indexes close sharply higher in the previous session as investors further mulled the path forward for interest rates and a host of new sanctions against Russia.

The S&P 500 inched up 0.2% and the Dow Jones Industrial Average registered a small gain of 60 points. The Nasdaq Composite struggled for direction as it wavered around the flatilne. All three benchmarks closed out Thursday’s higher by more than 1%, placing the indexes on pace for a second straight week of gains if levels hold through Friday’s close.

Developments in Russia’s war in Ukraine remained in focus as President Joe Biden meets with NATO allies in Europe. The U.S. leveled a fresh set of sanctions against Russia and vowed to provide more aid to Ukraine. Biden also said he would support removing Russia from the G20.

Despite the ongoing geopolitical conflict, stocks have remained relatively resilient this week in the face of upbeat economic data and a chorus of commentary from Federal Reserve officials reiterating the central bank’s more hawkish path forward to rein in inflation. In one of the latest datapoints underscoring the ultra-tight labor market, weekly jobless claims set the lowest level since 1969 last week, as companies held onto their existing workers amid widespread labor shortages.

Against this backdrop — and with inflation running at the hottest level in 40 years — central bankers have stepped up talk of tightening monetary policy. Chicago Federal Reserve President Charles Evans said Thursday he was “open” to the notion of a 50 basis-point interest rate hike at a forthcoming Fed meeting if needed. This echoed remarks from other Fed policymakers including San Francisco Fed President Mary Daly, who said earlier this week that if the Fed needed to do 50 basis points, then “50 is what we’ll do.” Fed Chair Jerome Powell earlier this week also signaled a willingness to roll out a larger-than-typical 50-basis point rate hike to address inflation, if deemed necessary.

While prospects of higher interest rates and tighter financial conditions were met with consternation among investors and choppiness in markets earlier this year, traders have begun to digest the prospects of a more hawkish Fed. Still, some strategists cautioned that volatility would likely still be in the cards in the near-term.

“We remain pretty bullish on the market overall but I do think that volatility is here to stay,” Ross Mayfield, Baird investment strategy analyst, told Yahoo Finance Live on Thursday.

“As far as catalysts, there’s a lot of stuff out there. There’s war in Ukraine. The market’s not moving as much on the day-to-day headlines there, but it doesn’t mean that there still couldn’t be a major catalyst from that event, either to the upside or the downside,” Mayfield added. “The Fed — we’ve got a pretty good picture of what they’re planning on doing, but any hints as we get towards May about 50 basis point rate hikes or balance sheet reduction or what that might look like could be a catalyst.”

Others offered a similar take.

“There has been quite a bit of bearish sentiment. We see money managers holding excess cash — more than normal, almost 6% on average in cash,” Loreen Gilbert, WealthWise Financial CEO, told Yahoo Finance Live. “I do not think the volatility is over. While we’re happy about some good market bounces on the upside, we’re looking also to see what’s going to happen going forward.”

9:30 a.m. ET: Stocks open in the green following Thursday’s gains

Here were the main moves in markets at the start of Friday’s session:

  • S&P 500 (^GSPC): +6.95 (+0.15%) to 4,527.11

  • Dow (^DJI): +72.28 (+0.21%) to 34,780.22

  • Nasdaq (^IXIC): -7.95 (-0.06%) to 14,183.89

  • Crude (CL=F): -$2.67 (-2.38%) to $109.67 a barrel

  • Gold (GC=F): -$11.40 (-0.58%) to $1,950.80 per ounce

  • 10-year Treasury (^TNX): +4.4 bps to yield 2.3850%

7:35 a.m. ET: Bed Bath & Beyond nears settlement with GameStop ape Ryan Cohen

Bed Bath & Beyond (BBBY) is approaching a settlement with GameStop executive chairman Ryan Cohen, Bloomberg reported on Friday. The deal could see three board members added to Bed Bath & Beyond.

Cohen, founder of the online pet goods retailer Chewy, disclosed a 9.8% stake in Bed Bath & Beyond earlier in March.

In a letter to Bed Bath & Beyond, Cohen said the company’s execution under CEO Mark Tritton has bordered on terrible, compensation is not realistic and the business should be split up (Buy Buy Baby business sold off) and then sold entirely to financial sponsors (private equity).

“We have carefully assessed Bed Bath’s assets, balance sheet, corporate governance, executive compensation, existing strategy and potential alternatives,” Cohen said in a letter obtained by Yahoo Finance. “While we like Bed Bath’s brand and capital allocation policy, we have concerns about leadership’s compensation relative to performance and its strategy for reigniting meaningful growth.”

Representatives for Cohen and Bed Bath & Beyond didn’t immediately reply to Yahoo Finance’s request for comment.

7:10 a.m. ET: Contracts on main indexes hover near flatline ahead of main trading session

Here were the main moves in markets at in pre-market trading Friday:

  • S&P 500 futures (ES=F): +9.00 points (+0.20%) to 4,521.50

  • Dow futures (YM=F): +58.00 points (+0.17%) to 34,662.00

  • Nasdaq futures (NQ=F): +31.75 points (+0.22%) to 14,795.50

  • Crude (CL=F): -$1.68 (-1.50%) to $110.66 a barrel

  • Gold (GC=F): -$11.20 (-0.57%) to $1,951.00 per ounce

  • 10-year Treasury (^TNX): 0.00 bps to yield 2.3410%

6:10 p.m. ET Thursday: Stock futures open little changed

Here’s where the major stock index futures opened Thursday evening:

  • S&P 500 futures (ES=F): +2.25 points (+0.05%) to 4,514.75

  • Dow futures (YM=F): +31 points (+0.09%) to 34,635.00

  • Nasdaq futures (NQ=F): -2.75 points (-0.02%) to 14,761.00

NEW YORK, NEW YORK – MARCH 11: Traders work on the floor of the New York Stock Exchange (NYSE) on March 11, 2022 in New York City. The Dow Jones Industrial Average was up over 200 points in morning trading on the last day of a volatile week for global markets. (Photo by Spencer Platt/Getty Images)

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter. Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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