US STOCKS-Wall Street set for weekly declines as concerns over economy, tech valuations weigh

By Twesha Dikshit and Purvi Agarwal

Nov 7 (Reuters) - Wall Street indexes were poised to open lower on Friday, and set for sharp weekly declines, as concerns about the economy and sky-high valuations in the technology sector soured sentiment.

The three main U.S. indexes ended sharply lower on Tuesday, with the tech-heavy Nasdaq .IXIC falling almost 2% after Wall Street executives earlier this week warned a market correction could be on the way.

The S&P 500 and the Dow are both set for their steepest weekly loss in four, while the Nasdaq is poised for its worst weekly performance since March.

"There is a continuation of the concern of a possible pullback... it's traditional early November weakness triggered by elevated valuations and the running out of catalysts to either support or propel the market," said Sam Stovall, chief investment strategist at CFRA Research.

Optimism around artificial intelligence has pushed markets to all-time highs this year, but concerns over monetization of the technology and circular spending within the industry has dampened enthusiasm for U.S. stocks in recent days.

At 08:44 a.m. ET, Dow E-minis YMcv1 were down 129 points, or 0.27%, S&P 500 E-minis EScv1 were down 29.5 points, or 0.44%, and Nasdaq 100 E-minis NQcv1 were down 164 points, or 0.65%

The CBOE Volatility Index .VIX, Wall Street's fear gauge, hit its highest level in more than two weeks.

Tesla TSLA.O shareholders approved the largest corporate pay package in history for CEO Elon Musk but shares fell tracking general sentiment. Intel INTC.O shares were marginally up after Musk said it could be 'worth having discussions' with the company to make chips.

With third-quarter earnings season in its final stretch, 83% of 424 companies in the S&P 500 that have reported results so far have beaten Wall Street expectations, according to Thursday's LSEG data.

This is the highest rate of better-than-expected results since the second quarter of 2021. Typically, 67% of companies beat estimates in a quarter.

Block XYZ.N missed third-quarter profit expectations amid economic uncertainty and intensifying competition in the payments sector, sending its shares down 14.5%.

ECONOMIC CONCERNS LINGER

The longest U.S. government shutdown in history has led to an information gap, with Federal Reserve policymakers divided on the best approach for December's policy meeting as private data paints a mixed picture of the economy.

The economic impact of the shutdown was far worse than expected, White House economic advisor Kevin Hassett said in an interview with Fox Business Network.

On Thursday, data from private companies pointed to layoffs in October, in contrast to Wednesday's ADP report that showed a rebound in private jobs.

"The question is, will it exacerbate an economic slowdown within the U.S.? There is a lot of uncertainty... it's not just the Fed that is flying blind, it is the American consumer and investor as well," said Stovall.

Among others, Expedia EXPE.O jumped 13.2% after the online travel platform boosted its forecast for full-year revenue growth and posted third-quarter profit above expectations.

Take-Two Interactive TTWO.O delayed its popular video game GTA VI to November 2026, sending shares falling 5%.