By Dhirendra Tripathi
Investing.com -- Stocks gave back their gains on Thursday, weighed by tech stocks and a sinking Peloton.
The exercise equipment maker will suspend production of its popular bikes and treadmills for at least a few weeks, according to CNBC. That sent its shares falling 20%.
Meanwhile, bond yields paused their steady climb to pandemic-era highs. The Nasdaq, which slid into correction territory on Wednesday, first gained and then went red later in the session.
Oil prices are also at seven-year highs.
The heart of earnings season is quickly approaching. Banks showed resilience in consumer and wealth management but struggled in some capital markets areas. Tech earnings kick off later tonight with Netflix.
In recent weeks, investors have shown concern that inflation would have to be answered by strong actions by the Federal Reserve, which is expected to raise interest rates four times this year. New cases of the Omicron variant of coronavirus appear to have reached a plateau in many areas, with some places in Europe lifting restrictions imposed to stop its spread.
Here are three things that could affect market tomorrow:
1. Peloton production
Pandemic darling Peloton Interactive Inc (NASDAQ:PTON) got pummeled in the market on Thursday after a CNBC report that it would halt production for a while on some of its popular exercise equipment amid a slowdown in demand. The stock, which traded below its IPO price of $29 a share and is likely to face additional scrutiny on Friday.
Peloton plans to halt production of its bike for two months, from February to March, CNBC reported, citing the documents. The stoppage comes just a month after the company suspended production of its Bike+ in December until June.
2. Netflix earnings
The streaming giant is the first of the FANG gang to report this quarter, and will do so after tonight’s closing bell. For the three months ended in December, Netflix Inc (NASDAQ:NFLX) has forecasted 8.5 million net new subscribers and a 16% gain in revenue to $7.7 billion. Analysts are expecting 8.3 million subscriber net adds and $7.7 billion in revenue.
3. American Airlines
American Airlines Group (NASDAQ:AAL) operating revenue more than doubled to over $9 billion as the carrier flew more passengers and freight. The loss per share of $1.42 more than halved from last time and was narrower than expected. That was despite the fact that fuel and related taxes in the fourth quarter more than tripled from a year ago to $2.2 billion.
The carrier continues to operate well below levels that were normal before the pandemic. It expects its January to March capacity to be down 8% to 10% compared to the same period in 2019.
–Investing.com staff and Reuters contributed to this report