Dow Jones Futures Fall As Snowflake Dives; Fed Inflation Gauge On Tap

Dow Jones futures were little changed overnight, along with S&P 500 futures and Nasdaq futures. Salesforce.com (CRM), Snowflake (SNOW) and bitcoin miner Marathon Digital (MARA) headlined earnings with the Fed’s favorite inflation gauge, the core PCE price index, on tap.

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The stock market rally saw slim-to-modest losses Wednesday, with the key indexes consolidating near highs ahead of inflation data before Thursday’s open. Bitcoin continued to skyrocket, surging above $64,000, before slashing gains to $60,312.44, up 5.8%.

Salesforce and Snowflake reported after the close, along with fellow software plays Nutanix (NTNX), Okta (OKTA), Duolingo (DUOL) and C3.ai (AI). Marathon Digital also released results, along with storage giant Pure Storage (PSTG).

Duolingo, Okta and C3.ai were big winners overnight, with Nutanix and Pure Storage solid gainers.  Salesforce edged lower after initially skidding. Snowflake stock plunged, with Marathon retreating.

Salesforce stock is on the IBD 50.

PCE Inflation

The Commerce Department will release the January PCE price index at 8:30 a.m. ET Thursday.

The overall PCE price index is expected to rise 0.3%, picking up from December’s 0.2%. But PCE inflation is seen slowing to 2.4% from December’s 2.6% year-over-year increase.

The core PCE price index should climb 0.4%. Core PCE inflation should still dip to 2.8% from December’s 2.9% annual increase.

The data will come as part of the monthly income and spending report. Economists forecast personal incomes to rise 0.4% with consumer spending just 0.2%.

Fed officials have signaled rate cuts will come later this year amid relatively strong economic data and sticky inflation. Markets are betting Fed rate cuts will start in June, but that’s no slam dunk. The Street sees 75 basis points of easing for the full year, with a chance of 100 basis points. At the start of 2024, investors were pricing in a March rate cut and 150 basis points of easing for the year.

Dow Jones Futures Today

Dow Jones futures fell about 0.1% vs. fair value. CRM stock is a Dow Jones component. S&P 500 futures edged higher and Nasdaq 100 futures were roughly flat. Salesforce and Snowflake are NYSE-listed, limiting the Nasdaq damage, but a number of software names retreated in sympathy overnight.

Bitcoin rebounded back above $61,000.

Remember that overnight action in Dow futures and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.

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Stock Market Rally

The stock market rally pulled back slightly Wednesday. The Dow Jones Industrial Average lost less than 0.1% in Wednesday’s stock market trading. The S&P 500 index fell 0.2%. The Nasdaq composite declined 0.55%. The small-cap Russell 2000 gave up 0.8%

The Nasdaq is no longer extended from the 50-day line after pausing for the past few days around the 16,000 level, but it would be extended with any decent gain. That’s been the story for the past few months.

U.S. crude oil prices dipped 0.4% to $78.54 a barrel.

The 10-year Treasury yield fell 4 basis points to 4.27%, still holding near 2024 highs.

ETFs

Among growth ETFs, the iShares Expanded Tech-Software Sector ETF (IGV) dipped 0.2%. CRM stock is a major holding, with Nutanix also in IGV. The VanEck Vectors Semiconductor ETF (SMH) slumped 1.1%.

Reflecting more-speculative story stocks, ARK Innovation ETF (ARKK) slid 0.7% and ARK Genomics ETF (ARKG) sank 2.1%.

SPDR S&P Metals & Mining ETF (XME) slumped 2.6% and the Global X U.S. Infrastructure Development ETF (PAVE) advanced 0.35%. U.S. Global Jets ETF (JETS) descended 0.5%. The SPDR S&P Homebuilders ETF (XHB) edged down 0.1%. The Energy Select SPDR ETF (XLE) was off 0.2% and the Health Care Select Sector SPDR Fund (XLV) declined 0.5%.

The Industrial Select Sector SPDR Fund (XLI) climbed 0.3% and The Financial Select SPDR ETF (XLF) rose 0.4%.

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Earnings

Salesforce earnings slightly topped Q4 views but revenue guidance was light. The Dow Jones software giant added $10 billion to a stock buyback and initiated a quarterly dividend. CRM stock fell slightly in overnight trade, coming back from solid declines. Shares edged up 0.1% to 299.77 in Wednesday’s regular session, nearing the November 2021 all-time high.

Snowflake earnings beat views, but the data analytics software firm gave weak guidance for the current fiscal year and said its CEO is retiring. SNOW stock crashed in extended action. Shares fell 1.7% to 230 on Wednesday. Snowflake stock has a 237.72 buy point from a three-weeks-tight entry.

Okta earnings and guidance were strong. Okta stock vaulted higher overnight. Shares advanced 0.45% to 87.30 on Wednesday. The cybersecurity play is working on a 92.38 buy point from a flat base that’s next to consolidations going back a year.

Nutanix earnings fell short though revenue topped. NTNX stock still rose modestly above 61 in…