Stock futures wavered on Friday as disappointing second-quarter earnings from Snap sent the stock down 28% after hours.
Shares of Meta Platforms and other social media stocks also tumbled in premarket trading after Snap's slower growth led to wider worries about online advertising.
Snap's results could spell concern for companies that rely on digital advertising for a significant portion of their revenue. In an investor letter that accompanied its second-quarter results, the company said "macroeconomic challenges have disrupted many of the industry segments" that advertise with Snap, which was trading at more than four times the volume of any other stock on Thursday evening.
"We are also seeing increasing competition for advertising dollars that are now growing more slowly," the company wrote. "Our revenue growth has substantially slowed, and we are evolving our business and strategy to adapt."
The company, which didn't provide forecasts for its third-quarter performance, also said it would adopt a "substantially reduced rate" of hiring.
Brad Erickson, an analyst with RBC Capital Markets, said Snap's guidance "confirmed our fears that ad spending is worsening...and unfortunately for Snap and the digital ad sector, we believe there are signs of further ad spending cuts still to come."
The data front is less busy on Friday, with the flash S&P Global U.S. manufacturing and services purchasing managers indexes.
The dollar rose 0.3% after its recent pullback as the narrative that other central banks are closing the gap with the Federal Reserve in lifting rates didn't seem to be a realistic driver for sustained depreciation of the currency, said ING.
It said the buck could extend gains on Friday as markets position for the Fed to potentially signal further aggressive policy tightening at next Wednesday's meeting and as global growth fears boost demand for safe havens.
"A consolidation above 107.00 in [the DXY Dollar Index] is our base case for the day."
Oil prices were lower in Europe, erasing earlier modest gains, as growth concerns continued to weigh on demand outlook, although analysts still expect tight supply to limit losses.
"A persistent tight market with limited spare capacity continues to put a floor under falling prices. Tensions over Russia continue to loom, and the U.S. and the EU are considering a possible oil price cap," said SPI Asset Management.
Copper held modest gains on concerns that a sudden drop in prices could crimp investments in new mines, something that would tighten supplies even further, said Richard Adkerson, CEO of mining company Freeport-McMoRan.
Copper has tumbled by nearly a quarter so far this year as concerns about slowing economic growth have dampened expectations for the metal's demand. The sudden and unexpected decline in prices came despite strong demand for the metal, Adkerson said.
Snap Posts Weakest-Ever Sales, Sending Shares Tumbling After Hours
Snap Inc. posted its weakest-ever quarterly sales growth as a public company, highlighting the extent of the upheaval the digital-advertising market is suffering from economic turmoil and other factors.
The parent company of popular photo-sharing social-media app Snapchat on Thursday said that revenue for the April through June period was $1.11 billion, narrowly missing scaled-back Wall Street expectations, according to analysts surveyed by FactSet. The 13% year-over-year sales growth in the second quarter was even lower than what the company registered early in the pandemic, when it slipped to 17%, and Snap said sales in the current period so far were roughly flat from a year ago.
FedEx to Suspend Sunday Delivery in Some Markets
FedEx Corp. is suspending Sunday residential delivery in certain U.S. markets starting next month, a move that comes amid pleas from its independent contractors in recent months for more compensation and a moderation in package volumes.
The service cutback for FedEx Ground starts the week of Aug. 15 and is targeted for areas with smaller populations, a company memo to some contractors said Thursday. The decision reflects a "continuous focus on improving efficiency and reducing costs," the company said.
Seven Crypto Companies That Laid Off Employees This Summer
The cryptocurrency market has lost about $2 trillion in value since hitting a peak in November, pushing companies into bankruptcies and causing mass layoffs across the industry.
Eurozone Economy Contracted in July, Composite PMI Drops Below 50
The eurozone economy contracted in July, according to the flash purchasing managers indexes, with output and new orders both falling for the first time since the Covid-19 lockdowns of early 2021, S&P Global said.
The eurozone composite PMI fell to 49.4 in July from 52.0 in June, dropping below the neutral level of 50.0. This points to a contraction in business output for the first time since February 2021.
Japan Inflation Shows Early Signs of Hitting a Peak
TOKYO-Inflation in Japan is showing tentative signs of peaking as global oil prices stabilize and consumers resist price increases.
Prices overall in Japan rose 2.4% in June from a year earlier, the government said Friday, a slight decline from the 2.5% year-over-year rise recorded in April and May. On a month-to-month basis, prices were 0.1% higher in June compared with May, a smaller rise than May's 0.2% increase compared with April.
California Holds Firm Against Truck Protests at Port of Oakland
California Gov. Gavin Newsom is digging in against protesters who this week shut down most operations at the Port of Oakland, saying truckers "should focus on supporting this transition" to a new employment law, even as shippers warned the impasse was hurting their businesses.
Mr. Newsom's administration indicated Thursday it wouldn't bow to the protesters' demands to pause the implementation of the new state law, known as AB5, that will make it harder for tens of thousands of independent truckers to operate in the state.
Jan. 6 Hearing Depicts Donald Trump as Content to Let the Riot Rage
WASHINGTON-President Donald Trump spent hours in front of a television at the White House watching the attack on the Capitol unfold on Jan. 6, 2021, ignoring pleas from staff, supporters and family to call off the rioters-and even at times encouraging them-according to testimony Thursday at a prime-time hearing of the House committee investigating the attack.
"The case against Donald Trump, in these hearings, is not made by witnesses who are his political enemies," said Rep. Liz Cheney (R., Wyo.), the committee's vice chair, at the close of the hearing, the eighth and last of the current series. "It is instead a series of confessions by Donald Trump's own appointees, his own friends, his own campaign officials, people who worked for him for years, and his own family."
Supreme Court Rules Against Biden Administration's Immigration Enforcement Guidelines
WASHINGTON-The Supreme Court denied an emergency request from the Biden administration to reinstate its immigration enforcement guidelines after a lower court in Texas temporarily blocked them.
In a 5-4 decision with Justice Amy Coney Barrett joining Justices Sonia Sotomayor, Elena Kagan and Ketanji Brown Jackson in the minority, the court ruled that the administration can't use the guidelines for now-and agreed to hear a case on their legality in December.
France's National Assembly Passes Bill to Fight Inflation in Win for Macron
PARIS-France's National Assembly approved billions of euros in new measures to help households cope with record inflation, an early victory in President Emmanuel Macron's efforts to govern without a clear majority in the country's deeply divided Parliament.
The National Assembly, France's lower house, Friday voted 341-116 to pass the new measures, which include an increase in pensions and a boost to social benefits. The proposed legislation, which the government says is part of a new EUR20 billion package aimed at fighting inflation, now heads to the Senate.
Sri Lanka Security Forces Clear Main Protest Camp in Colombo
COLOMBO, Sri Lanka-Sri Lankan security forces raided the main antigovernment protest camp in Colombo in the early hours of Friday, taking down tents and removing activists from the grounds of the president's office, within a day of President Ranil Wickremesinghe being sworn in.
The military and police entered the camp at about 1:30 a.m. local time, and forced people to leave the Presidential Secretariat, which thousands of protesters had occupied earlier this month, according to protesters and a soldier who took part in the operation. Protest organizers had earlier announced that the few dozen people who remained planned to vacate the building on Friday afternoon, after Mr. Wickremesinghe was due to swear in a new prime minister.
Drone Near Reagan Washington National Airport Briefly Interrupts Air Traffic
A drone spotted near Ronald Reagan Washington National Airport briefly halted arrivals and departures there Thursday afternoon, the Federal Aviation Administration said.
The halt lasted from about 1:23 p.m. to 1:36 p.m. local time, the FAA said, adding that it immediately notified law enforcement. A spokesperson for the airport said normal operations had resumed by 2:15 p.m.
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Expected Major Events for Friday
00:30/JPN: Jul Japan Flash Manufacturing PMI
06:00/UK: Jun UK monthly retail sales figures
07:15/FRA: Jul France Flash PMI
07:30/GER: Jul Germany Flash PMI
08:30/UK: Jul Flash UK PMI
13:45/US: Jul US Flash Manufacturing PMI
13:45/US: Jul US Flash Services PMI
14:00/US: Jun State Employment and Unemployment
(MORE TO FOLLOW) Dow Jones Newswires
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