5 things to know before the stock market opens on Friday, May 13

Here are the top news, trends and analysis that investors need to start their trading day:

1. Dow Jones futures pop up after the six-session streak of losses for the 30 stock average

The Twitter logo and trading information are displayed as a trader works on the floor of the New York Stock Exchange (NYSE) in New York City, US, May 3, 2022.

Brendan McDermid | Reuters

US stock futures rebounded on Friday, with the S&P 500 trying not to join the Nasdaq in a bear market, which is set to fall 20% or more from its previous high.

  • Nasdaq futures led the way higher despite a pre-market drop of 12% in Twitter shares. The stock fell as much as 25% after Elon Musk tweeted on Friday that his deal to buy the social network was “temporarily on hold.” Twitter shares were paring those losses when Musk later tweeted that he was “still committed” to the deal.
  • The Dow Jones Industrial Average fell on Thursday for the sixth consecutive session, sinking further into the correction set by a decline of 10% or more from its previous high. The S&P 500 is down slightly. The Nasdaq managed to post small gains.

2. Bond yields rose after Powell said he could not guarantee a soft landing

The 10-year Treasury yield rose on Friday but remained below 3%, a key level that was breached on May 2 for the first time since late 2018.

  • Bond yields rose rapidly on the belief that the Federal Reserve would have to act more aggressively in raising interest rates to fight inflation. There is concern that inflation will remain high even as the economy slows.
  • Federal Reserve Chairman Jerome Powell said in an interview published Thursday on Marketplace that he cannot promise the economy’s so-called soft landing. He warned that controlling inflation may cause some economic pain, but it remains a top priority.

3. Two Elon Musk tweets about his Twitter deal hit the stock

With two tweets on Friday morning, Musk sent Twitter posts on a road trip. After he said he had discontinued his Twitter run in search of more information about the number of fake accounts on the social media platform, he later said he “remains committed to the acquisition.” The first tweet came at 5:44 AM ET. The second tweet was posted about two hours later.

Tesla CEO Musk announced last month that he intends to buy Twitter for $44 billion, and he previously tweeted that one of his main priorities would be to remove “spam bots” from the platform. Shares of Tesla, which had recently fallen on fears that Musk’s Twitter deal could be a distraction, surged more than 5% on Friday in the first tweet and held those gains after the second.

4. Some stablecoins are gaining a foothold, helping to elevate the cryptocurrency market

Tether has long faced questions about whether it has enough assets to justify its peg to the dollar.

Tiffany Hagler | Bloomberg via Getty Images

Tether, the world’s largest stablecoin, has regained its dollar peg after the coin left the system with a value of more than $3 billion in a single day. The cryptocurrency – which is always supposed to be worth $1 – fell to 95 cents on Thursday. A controversial stablecoin known as TerraUSD or UST, which is supposed to be pegged to the dollar 1-to-1, has collapsed in recent days, trading around 8 cents on Friday. Luna, a token closely associated with UST, is now worth $0 as a result.

  • The stablecoin saga added a layer of uncertainty that contributed to the sharp declines in the entire cryptocurrency market. Bitcoin is back above $30K on Friday, rebounding from levels not seen since late 2020. At current levels, Bitcoin, the world’s largest cryptocurrency, is down more than 50% from its all-time high of more than $68K. In November.

5. CEO of Major Crypto Exchange Takes Big Stake in Robinhood

Sam Bankman-Fried, CEO of FTX US Derivatives, testifies during a House Agriculture Committee hearing entitled Changing Market Roles: The FTX Proposal and Trends in New Clearing Models, at the Longworth Building on Thursday, May 12, 2022.

Tom Williams | CQ-Roll Call, Inc. | Getty Images

  • Shares of Robinhood, the popular stock and cryptocurrency trading platform, jumped more than 23% in the primary market on Friday. In regular trading on Thursday, the stock hit an all-time low. Robinhood closed the session at $8.56, about 77% off its IPO price last July.
  • The document said Bankmanfried did not plan to take “any action towards altering or affecting the control” of the company. The request also said it may “from time to time enter into discussions” with the administration.

– CNBC channel Jesse PoundAnd Vicki McIverAnd Jeff CoxAnd Sam Shedd And Tanaya Machel Contribute to this report.

open an account now For the CNBC Investing Club to follow Jim Cramer’s every arrow move. Follow the actions of the wider market like a pro CNBC PRO.

Leave a Comment