Equity futures are rising after the Dow turned negative this year

You want to be involved with materials, energy and care, says Mark Newton of Fundstrat

Equity futures traded higher on Thursday as investors tried to hang on to the January rally amid monetary policy concerns and slowing earnings.

Futures linked to the Dow Jones Industrial Average rose 11 points, or 0.03%. S&P 500 and Nasdaq 100 futures gained 0.09% and 0.27%, respectively. Nordstrom fell more than 5% in after-hours trading after reporting weak holiday sales and lowering its year-end forecast. Netflix rose 7% after reporting more subscribers than expected, though its quarterly revenue beat analyst estimates.

During Thursday’s session, the Dow and S&P 500 both closed lower and hit their third consecutive negative day as corporate earnings and economic data point to a slowing economy. The Dow fell more than 252 points, or 0.76% and is now down 0.31% year to date. The S&P 500 lost 0.76% and the Nasdaq Composite lost 0.96%, but both indexes are positive for the year.

For this week, however, all three indices are on track to close lower. The Dow Jones is down 3.67%, heading for its worst week since September. The S&P 500 is down more than 2.5% and could post its worst weekly performance since December. The Nasdaq is down more than 2% and is on track to break a two-week profit streak.

“The market is focused and not sure how to react between the backward Fed analysis of the market versus the forward and leading indicators of the market,” said Tim Seymour, founder and chief investment officer of Seymour Asset Management, on CNBC’s “Fast Money.”

Those forward indicators include economic data such as retail sales and industrial production. “This is where the market starts to collapse,” he said.

Going forward, investors will continue to monitor corporate earnings as oilfield services SLB and Ally Financial will report Friday. They will also listen closely to speeches by Fed officials ahead of the central bank meeting in February, looking for clues as to the size of the rate hike that is likely to occur.

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