Stock futures inch lower as Wall Street awaits final trading day of 2022

Traders work on the floor of the New York Stock Exchange (NYSE) on December 15, 2022 in New York City.

Spencer Platt | Good pictures

Stock futures were lower in Thursday night trading as investors braced for the worst final trading day of the year for stocks since 2008.

Futures for the Dow Jones industrial average fell 41 points, or 0.12%. S&P 500 and Nasdaq 100 futures were down 0.14% and 0.08%, respectively.

Overnight moves continued a rally during the regular trading session, with the Nasdaq Composite and S&P 500 climbing roughly 2.6% and roughly 1.8%, respectively. The Dow rose 345 points, or 1.05%.

For the week, the Dow and S&P are slightly higher, with the Nasdaq on track for a modest loss. All major averages are lower in December and poised to snap a two-month winning streak.

Friday marks the final day of trading in what has been a painful year for stocks. A volatile bear market, sticky inflation and aggressive rate hikes by the Federal Reserve weighed on growth and tech stocks. These factors also affected investor sentiment.

All three major averages are headed for their worst year since 2008, snapping a three-year winning streak. The Dow is down 8.58% in 2022, while the S&P and tech-heavy Nasdaq are down 19.24% and 33.03%, respectively.

Despite annual losses, the Dow is on pace for a 15.65% quarterly gain and is primed to snap a three-quarter losing streak. This makes it its best quarter since the second quarter of 2020. The S&P is up 7.35% and is on course to snap three consecutive quarters of losses. The Nasdaq fell 0.92%, its fourth consecutive negative quarter for the first time since 2001.

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All major S&P sectors ended Thursday with gains, led by communications services. Consumer discretionary and communication services were the only loss-making sectors in the quarter. Energy was the only sector on pace for annual gains after rising nearly 58%.

As the calendar year turns the corner, some investors feel the pain is far from over and expect the bear market to last until a recession hits or the Fed takes the lead. Some project stocks hit new lows. Thursday’s moves likely stemmed from a combination of short covering, value investing and momentum traders, said Adam Sarhan, CEO of 50 Park Investments.

“Fundamentally nothing has changed,” he said. “We’ve had a big drop. The market has extended to the pullback, and it’s very normal to see a bounce here.”

On the economic front, Chicago PMI data for December will be released on Friday.

— Gabriel Cortez contributed reporting

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