The major U.S. index futures are currently pointing to a roughly flat open on Friday, with stocks likely to show a lack of direction after trending lower over the past several sessions.

The futures had been pointing to a lower open earlier in the morning after Israel launched strikes against Iran, in what appeared to be limited retaliatory action for last week’s drone and missile barrage by Tehran.

However, negative sentiment has waned after Iranian state media downplayed the attacks, saying explosions heard in Isfahan were a result of the activation of Iran’s air defense systems.

The semi-official news agency Tasnim also reported the nuclear facilities in Iran’s central Isfahan province are completely safe.

Nonetheless, a steep drop by shares of Netflix (NASDAQ:NFLX) may still weigh on the markets, as the streaming giant is plunging by 6.8 percent in pre-market trading.

Netflix is under pressure after reporting better than expected first quarter results but providing disappointing revenue guidance.

Consumer products giant Procter & Gamble (NYSE:PG) is also seeing pre-market weakness after reporting first quarter earnings that beat analyst estimates but weaker than expected sales.

On the other hand, shares of American Express (NYSE:AXP) are edging higher in pre-market trading after the financial services giant reported first quarter results that exceeded expectations.

Overall trading activity may be somewhat subdued, however, with a lack of major U.S. economic data likely to keep some traders on the sidelines.

After once again failing to sustain an early upward move, stocks came under pressure over the course of the trading session on Thursday. The major averages pulled back well off their highs of the session, with the Nasdaq and the S&P 500 ending the day in negative territory.

Reflecting weakness in the tech sector, the Nasdaq slid 81.87 points or 0.5 percent to 15,601.50, while the S&P 500 dipped 11.09 points or 0.2 percent to 5,011.12. The narrower Dow bucked the downtrend, inching up 22.07 points or 0.1 percent to 37,775.38

With the downturn on the day, the Nasdaq and the S&P 500 extended their losing streaks to five days, falling to their lowest closing levels in almost two months.

The early strength on Wall Street partly reflected bargain hunting, as traders looked to pick up stocks at relatively reduced levels following recent weakness.

However, as with other recent rebound attempts, buying interest waned over the course of the session amid ongoing concerns about the outlook for interest rates.

Potentially adding to the interest rate worries, the Philadelphia Federal Reserve released a report showing a considerable acceleration in the pace of growth in regional manufacturing activity in the month of April.

The Philly Fed said its diffusion index for current general activity jumped to 15.5 in April from 3.2 in March, with a positive reading indicating growth. Economists had expected the index to edge down to 1.5.

Notably, the report also said the prices paid index surged to 23.0 in April from 3.7 in May, reaching its highest reading since December 2023.

Quincy Krosby, Chief Global Strategist for LPL Financial, said the spike by the prices paid index supports “the Fed’s concerns regarding inflationary pressures stalling in its downward trajectory.”

The Labor Department also released a report showing first-time claims for U.S. unemployment benefits remained flat in the week ended April 13th.

The report said initial jobless claims came in at 212,000, unchanged from the previous week’s revised level. Economists had expected jobless claims to rise to 215,000 from the 211,000 originally reported for the previous week.

“Jobless claims remain well below levels that would signal a major slowdown in job growth,” said Nancy Vanden Houten, Lead U.S. Economist at Oxford Economics.

She added, “A strong labor market gives the Federal Reserve the room to put off rate cuts until inflation gets back on a sustainable path to 2%.”

Meanwhile, the National Association of Realtors released a report showing a sharp pullback by existing home sales in the U.S. in the month March.

NAR said existing home sales plunged by 4.3 percent to an annual rate of 4.19 million in March after surging by 9.5 percent to a rate of 4.38 million in February. Economists had expected existing home sales to slump to a rate of 4.20 million.

Semiconductor stocks came under pressure over the course of the session, dragging the Philadelphia Semiconductor Index down by 1.7 percent to its lowest closing level in almost two months.

U.S.-listed shares of Taiwan Semiconductor Manufacturing (NYSE:TSM) have tumbled by 4.9 percent even though the chipmaker reported better than expected first quarter results.

Considerable weakness also emerged among biotechnology stocks, with the NYSE Arca Biotechnology Index falling by 1.6 percent to its lowest closing level in well over four months.

Software, computer hardware and oil producer stocks also moved to the downside on the day, while significant strength remained visible among airline stocks.

Alaska Air (NYSE:ALK) soared by 4.0 percent after reporting a narrower than expected first quarter loss on revenues that exceeded analyst estimates.