Stock futures were little changed on Thursday evening as investors prepared for the S&P 500 to potentially slide into official bear market territory.
The futures tied to the Industrial Average shed 9 points. The S&P 500 futures were slightly higher.
The S&P 500 and the Dow fell after bouncing off their lows. The S&P closed down 18% from its all-time high, and will be in a bear market if the loss deepens to 20%. The stock market has been declining for six straight trading sessions.
The tech-laden index is in a bear market, down more than 29% from its all-time high, despite a small gain on Wednesday.
The stock market has been slumping for months, starting with unprofitable tech stocks late last year and spreading to companies with healthy cash flows in recent weeks. Apple became the last of the Big Tech names to fall into a bear market on Thursday.
The rapid gains stocks enjoyed after their lows in March 2020 have been wiped out by the decline.
Large deviations from long-term price trends have been used for bubble identification. Dirk Willer said in a note to clients on Thursday that US equities have been in a bubble based on this metric.
High inflation and the Federal Reserve's attempts to contain prices by raising rates are some of the reasons that stocks have struggled recently. Powell told NPR that he couldn't guarantee a soft landing that wouldn't cause a recession.
After the first rate hike by the Fed in March, the stock market enjoyed a two-week rally, but it was erased by a brutal April and the selling has continued in May. There are some signs that the market may be close, such as investor sentiment surveys and some stabilization in the Treasury market this week, but many investors and strategists say the market may need to take another sizable step down.
The market is begging for a bottom, and you're getting it. Andrew Smith, chief investment strategist at Delos Capital Advisors, said that there has not been a capitulation day.
This week has seen developments in cryptocurrencies that have unnerved Wall Street.
Friday has a read on April import prices and an early look at May consumer confidence.
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