Markets Edge Lower Ahead of Inflation Data, While Netflix Bows Out and Block Cuts Deep

Futures dipped Friday as investors awaited wholesale inflation figures, with a mixed bag of earnings and corporate moves driving individual stocks.

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U.S. stock futures were pointing lower Friday morning, setting a cautious tone as traders braced for the latest read on wholesale inflation. This comes after a mixed session Thursday where the Dow Jones eked out a tiny gain while the Nasdaq took a more noticeable hit.

The main event for the day is the January Producer Price Index (PPI), scheduled for release before the opening bell. Economists are expecting both the headline number and the core figure (which excludes food and energy) to climb 0.3%. It's the kind of data that keeps the Federal Reserve in the spotlight, even though markets are currently betting with near-certainty—96.1% according to the CME FedWatch Tool—that rates will stay put at the next meeting in March.

In the bond market, the 10-year Treasury yield was sitting at 4.00%, with the two-year note at 3.42%.

Here’s a quick look at how the major index futures were shaping up in premarket trading:

The popular ETFs that track the broader market were also in the red. The SPDR S&P 500 ETF Trust (SPY)was down 0.21% at $687.86, and the Invesco QQQ Trust ETF (QQQ) declined 0.12% to $608.52.

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While the macro picture set a somber mood, there was plenty of action under the surface thanks to earnings and corporate news.

Shares of Netflix Inc. (NFLX) jumped 8.66% in premarket trading. The streaming giant decided to walk away from a bidding war with Warner Bros Discovery Inc. (WBD) after a higher bid emerged from Paramount Skydance Corp. (PSKY), which itself saw shares rise 8.32%. Sometimes the best move is not to play. Despite the pop, market data indicates NFLX has shown a weaker price trend in the medium and long term, with a poor value ranking.

It was a huge day for Block Inc. (XYZ), with shares surging 22.28%. The company reported fourth-quarter earnings that met expectations and announced plans to reduce its workforce by more than 40%. Investors seemed to applaud the cost-cutting focus. Market data shows XYZ maintains a strong price trend across short, medium, and long terms, with a solid growth score.

On the flip side, Zscaler Inc. (ZS) tumbled 8.62%. The cybersecurity firm delivered better-than-expected Q2 results but then turned around and slashed its sales guidance for fiscal year 2026. It’s a classic case of good news being immediately overshadowed by bad news. The stock maintains a weak price trend across all time frames according to market data.

Dell Technologies Inc. (DELL) enjoyed a 12.64% leap after reporting fourth-quarter results that beat estimates and issuing fiscal year 2027 guidance that came in above expectations. Market data indicates DELL has a strong price trend in the short and long term, but a weaker one in the medium term, with a moderate value score.

Space company Rocket Lab Corp. (RKLB) declined 4.45% after reporting fourth-quarter results where its losses remained broadly similar year-over-year. Market data shows a weak short-term price trend for RKLB, but stronger trends over the medium and long term.

Thursday was a story of divergence. While the S&P 500 and Nasdaq closed lower, the Dow managed a slight gain and the Russell 2000 of small-cap stocks actually rose 0.52%. Sector performance was a mixed bag: industrials and financials bucked the trend to finish higher, while consumer discretionary, information technology, and communication services stocks recorded the biggest losses.

Doug Beath, Global Equity Strategist at the Wells Fargo Investment Institute, is maintaining a constructive outlook. He sees the recent "rotation and broadening out" of equity markets as a positive sign that "economic growth will accelerate this year."

Beath does expect more volatility in 2026, thanks to midterm elections and a change in leadership at the Fed. He notes that the market, especially the tech sector, has become more sensitive to headlines, particularly around shifting fears regarding artificial intelligence. But he views these swings as a "prelude to broad equity gains this year."

His advice? "Stay nimble" and use market "chop" as a chance to put new cash to work in U.S. Large Cap Equities and the Financials sector. This optimism is backed by solid numbers: fourth-quarter earnings estimates for the S&P 500 have accelerated to around 13%, with small- and mid-cap indexes also beating expectations.

Friday's data docket is all about catching up and looking forward:

Over in commodities, crude oil futures were up 1.81% to hover around $66.40 per barrel. Gold was slightly lower, down 0.13% to about $5,178.63 an ounce (still well below its record high of $5,595.46). The U.S. Dollar Index was also down a tick, 0.08% lower.

In crypto, Bitcoin (BTC) was trading 0.28% lower at $67,992.08.

Global equity markets painted a mixed picture. In Asia, Hong Kong's Hang Seng, Japan's Nikkei 225, and Australia's ASX 200 rose, while China’s CSI 300, South Korea's Kospi, and India’s Nifty 50 fell. European markets were mostly higher in early trade.

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