Stock Futures Seen Lower Ahead of Initial Claims Data

This post was originally published on this site – U.S. stocks are set to open lower Thursday, after the sharp rebound during the previous session, with investors cautious ahead of the release of key unemployment data. 

At 7 AM ET (1100 GMT), S&P 500 Futures traded 20 points, or 0.6%, lower, the Dow Futures contract fell 160 points, or 0.6%, while Nasdaq 100 Futures dropped 56 points, or 0.5%. 

The tech-heavy Nasdaq Composite index posted its steepest rise in more than four months on Wednesday, gaining 2.7%, to halt a three-session slump, while the Dow Jones Industrial Average rose 1.6% and the S&P 500 climbed 2%.

Investors are grappling with whether the recent steep U.S. tech selloff is largely over, and beyond that the strength of the economic recovery amid an increasingly uncertain U.S. political outlook.

Focus will turn to the release of the weekly initial jobless claims, at 8:30 AM ET, which are expected to be 846,000, down from 881,000 the previous week. Continuing jobless claims, which come out at the same time, are expected to number 12.9 million, down from 13.2 million the previous week. 

There will also be producer price inflation data for August.

“With a range of data pointing to a levelling off in activity since July it is likely that unemployment stays persistently high and that the U.S. economy will not fully recoup all its lost output before mid-2022 unless there is a new large fiscal stimulus and good news on a vaccine,” said analyst James Knightley at ING, in a note.

A vote in the Senate is set to take place later Thursday on the Republicans’ $500 billion coronavirus relief-bill proposal – the first formal vote of the Senate on the subject since March. However, the bill is unlikely to proceed as the Democrats who control the House of Representatives say it fails to take account of the gravity of the crisis. 

This could well be the final vote on coronavirus relief in Congress before the hotly-contested presidential and congressional elections in early November.

In corporate news, two companies which are seen as benefiting from the coronavirus-inspired lockdowns report earnings Thursday after the closing bell, namely stay-at-home exercise cult favorite Peloton Interactive (NASDAQ:PTON) and tech giant Oracle (NYSE:ORCL). 

Oil prices slipped back Thursday, after the American Petroleum Institute on Wednesday reported a 2.97 million barrel-build in the country’s crude stockpiles last week, raising concerns about the strength of the demand recovery.

The U.S. Energy Information Administration will release official weekly inventory data later on Thursday, a day later than normal following the U.S. Labor Day holiday.

U.S. crude futures traded 1.6% lower at $37.43 a barrel, while the international benchmark Brent contract fell 1.2% to $40.31.

Elsewhere, gold futures rose 0.2% to $1,959.30/oz, while EUR/USD traded 0.3% higher at 1.1838.