U.S. stock-index futures largely gave up early gains Thursday after data showed first-time applications for unemployment benefits rose last week.
Corporate earnings reports continue to roll in, supporting the recovery in stocks this week though, while the European Central Bank offered a dovish tweak to its guidance on interest rates and monetary policy.
What are major indexes doing?
Futures on the Dow Jones Industrial Average
fell 43 points, or 0.1%, to 34,646.
S&P 500 futures
were off 3.5 points, or 0.1%, at 4,347.
ticked up 4.25 points to 14,832.
On Wednesday, the Dow Jones Industrial Average
rose 286.01 points, or 0.8%, to finish at 34,798, while the S&P 500
advanced 0.8% and the Nasdaq Composite
What’s driving the market?
Stocks have rebounded in the past two days from a sharp Monday selloff, with all three major indexes positive on the week as investors put jitters over the spread of the delta variant of the coronavirus that causes COVID-19 behind them.
But Thursday’s U.S. jobs data threatened to undercut the rebound. The Labor Department said initial jobless claims rose by 51,000 to 419,000 in the seven days ended July 17 — the highest level in almost two months. The increase, however, was concentrated in Michigan and Kentucky and likely is tied to the annual retooling of auto plants to build new models while 31 states actually posted declines in jobless benefit claims.
“The total number of people relying on government support continues to decline as federal programs expire across states,” said Rubeela Farooqi, chief U.S. economist at High Frequency Economics. “Beyond weekly gyrations in the claims data that could
reflect issues related to seasonal adjustment, the trend in filings should remain downward.”
Stocks have bounced back from a steep Monday selloff, with investors citing a moderation of worries about the implications of the spread of the delta variant of the coronavirus that causes COVID-19.
“It seems that concerns over the fast-spreading delta variant of the coronavirus continued to ease, perhaps due to upbeat earnings results, or because…market participants may have had second thoughts over how restrictive any potential new measures could be,” said Charalambos Pissouros, head of research at JFD Group, in a note.
With that in mind, Pissouros said he expects the broader path for stocks to remain positive, with any setbacks likely to trigger more buying, “perhaps on fear of missing out.”
Some analysts are penciling in the potential for further near-term weakness amid weak seasonal factors, stretched valuations, worries that economic growth is peaking, and uncertainty over the spread of the delta variant.
Investors will also get a look at data on June existing home sales, which are expected to rise to a 5.93 million annualized pace from 5.8 million in May. The June Index of Leading Economic Indicators, set for release at 10 a.m., is forecast to drop to 0.9% from 1.3%.
Which companies are in focus?
shares edged higher in premarket trade after the chemicals company swung to a second-quarter profit and reported revenue that rose above expectations, boosted by sharp local price increases amid stronger demand.
late Wednesday reported a 32% increase in quarterly sales and said it was boosting its 2021 guidance, citing continued demand for its kitchen and laundry appliances. Shares were down 0.4%.
was up 1% after topping expectations with its latest financial results as the telecommunications giant continued to see low customer churn in its wireless business as well as subscriber growth for the HBO Max service.
gained 1.6% in premarket trading on Thursday after the company beat expectations for the second quarter and disclosed that it’s already sold $2 million of its new, controversial Alzheimer’s disease drug.
Southwest Airlines Co.
rose 3.3% after reporting net income of $348 million, or 57 cents a share, in the second quarter, after a loss of $915 million, or $1.63 a share, in the year-earlier period, when travel stalled during the global pandemic.