US stock futures pointed to another rough day on Wall Street Friday after the House of Representatives voted against a Trump-backed spending bill, further increasing the odds of a US government shutdown this weekend.
Investors are also awaiting key inflation data for further clues into future monetary policy after the Federal Reserve lowered the number of cuts it expects next year.
Futures tied to the S&P 500 (ES=F) dropped 1%, while those on the tech-heavy Nasdaq (NQ=F) plunged 1.6%. Dow Jones Industrial Average futures (YM=F) also fell around 0.5%.
A Fed-induced sell-off earlier in the week left the major averages reeling. And although stocks mostly stabilized on Thursday, the threat of a government shutdown, coupled with more Trump tariff threats on Europe, pressured global markets across the board.
“I told the European Union that they must make up their tremendous deficit with the United States by the large scale purchase of our oil and gas,” Trump said in a post on Truth Social. “Otherwise, it is TARIFFS all the way!!!”
Global chip stocks sold off premarket, with Europe’s ASML (ASML) dropping nearly 2% early Friday while Taiwan’s TSMC (TSMC34.SA) fell about 3%. US-based names such as Nvidia (NVDA), AMD (AMD), and Broadcom (AVGO) also came under pressure.
Bitcoin (BTC-USD) prices retreated nearly 10% from earlier highs to drop below the critical $100,000 mark amid record ETF outflows.
And in individual names, Novo Nordisk (NVO) plunged about 20% — the most in over two decades — after its obesity drug trial disappointed investors. Tesla (TSLA) shares dropped 6% after recalling about 700,000 US vehicles over a tire pressure monitoring system defect.
Meanwhile, investors will digest another piece of the inflation puzzle with the release of the Fed’s preferred inflation gauge, the core Personal Consumption Expenditures (PCE) index, due later this morning..
On Wednesday, the Fed scaled back the number of rate cuts it expects in 2025 from four to just two, suggesting the central bank will take a more cautious approach after launching its long-awaited easing cycle earlier this year.
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