Here are the most important news, trends and analysis that investors need to start their trading day:
1. Wall Street set for lower open after 3-day winning streak
Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, December 8, 2021.
Brendan McDermid | Reuters
U.S. stock futures dropped Thursday, one day after Wall Street logged its third straight positive session. Investors continued to readjust as emerging evidence showed the omicron Covid variant might not be as disruptive to the U.S. economic recovery as first thought. On Wednesday, the Dow Jones Industrial Average, the S&P 500 and the Nasdaq managed to post modest gains. The S&P 500 finished just a few points shy of its Nov. 18 record close. The Dow and Nasdaq finished nearly 1.9% and nearly 1.7% away from their respective record closes on Nov. 8 and Nov. 19. CVS Health shares were one of the big premarket winners, rising more than 2% after the pharmacy chain boosted its fiscal 2022 guidance ahead of Thursday’s investor day.
2. New jobless claims last week hit a new five decade low
One day before a key inflation report, the government said Thursday that initial jobless claims dropped to 184,000 last week, much lower than estimates and a new 52-year low level. The previous week’s reading was revised higher by 5,000 to 227,000. On Friday, the November consumer price index is expected to show a year-over-year rise of 6.7%, which would mark the biggest move since June 1982. Federal Reserve officials are expected to react to the burst in inflation by announcing next week that they’ll accelerate pulling back on massive Covid-era bond purchases. That in turn could pave the way for interest rate hikes as soon as the spring of 2022.
3. Apple gets a reprieve; Amazon fined; and Instagram chief wavers
Apple won a reprieve from having to make major changes to its lucrative App Store while it appeals an antitrust lawsuit brought by “Fortnite” creator Epic Games. Wednesday’s stay means the App Store can continue to prohibit developers from adding external links to other payment methods while the case brought by “Fortnite” maker Epic Games is appealed.
Italian antitrust regulators said Thursday they fined Amazon $1.28 billion for abusing its market dominance. Amazon plans to appeal, saying more than 50% of all annual sales on its platform in Italy come from small and medium-sized businesses.
Instagram CEO Adam Mosseri, testifying for the first time before Congress, refused to commit to permanently ending the paused plans to create a version of the platform for kids under 13. Lawmakers expressed frustration and distrust of the service, owned by Meta, which recently changed its corporate name from Facebook.
4. GameStop shares drop as video game retailer’s loss widens
GameStop shares fell 4% in Thursday’s premarket, the morning after the video game retailer posted a wider loss compared to a year earlier. It also disclosed an August subpoena from the Securities and Exchange Commission involving the trading of its stock, which has been driven more than 800% higher in 2021, as investors banded together on Reddit to crush short-sellers. GameStop’s new leaders have provided few details about their turnaround strategy. On the post-earnings call, CEO Matt Furlong did say GameStop is “exploring emerging opportunities,” including blockchain, nonfungible tokens and web 3.0 gaming.
5. FDA clears AstraZeneca’s Covid treatment for immunocompromised
The Food and Drug Administration authorized the first injectable monoclonal antibody cocktail for people with weakened immune systems before they have been exposed to the coronavirus. The FDA issued an emergency use authorization Wednesday for AstraZeneca‘s therapy to be used as a prophylactic. To date, such lab-produced antibodies have been authorized only as early Covid treatment or as preventive therapy for high-risk people immediately after close contact with someone who has tested positive. The AstraZeneca cocktail involves getting preventive injections as often as every six months.