By Anora Mahmudova and Sara Sjolin, MarketWatch
Dollar climbs to 12-year high against yen
U.S. investors took a cautious stance early on Thursday, with
stock futures trading lower, as concerns about the timing of the
first Federal Reserve rate hike dampened appetite for riskier
assets.
Market reaction to weekly jobless claims data was mostly muted.
A jump in weekly jobless claims was bigger than expected, however,
the pace of layoffs still remained near a record low.
Futures for the Dow Jones Industrial Average (YMM5) fell 50
points, or 0.3%, to 18,091, while those for the S&P 500 index
(ESM5) dropped 4 points, or 0.2%, to 2,117. Futures for the Nasdaq
100 index (NQM5) gave up 6 points, or 0.1%, to 4,536.
This suggests the benchmarks will pull back from the solid gains
they posted on Wednesday
(http://www.marketwatch.com/storyno-meta-for-guid), when the Nasdaq
Composite (RIXF) closed at a record high.
Wednesday's advances partly came on the back of positive news
out of Greece. Prime Minister Alexis Tsipras said the debt-strapped
country was in the final stages of reaching a deal with its
international creditors. However, European officials poured cold
water on the suggestion, saying there is still much work to be
done.
The mixed messages on Greece weighed on equities on Thursday,
according to analysts.
Data: The number of people who applied for unemployment benefits
(http://www.marketwatch.com/story/jobless-claims-climb-to-five-week-high-of-282000-2015-05-28)in
late May rose to a five-week high, but the rate of layoffs in the
U.S. economy remained near a record low. Initial jobless claims
climbed by 7,000 to a seasonally adjusted 282,000 in the week
ending May 23, the Labor Department said Thursday.
Fed speakers: Speaking to the Monetary Authority of Singapore,
John Williams, president of the San Francisco Fed, said the central
bank shouldn't use interest-rate policy to address risks to
financial stability
(http://www.marketwatch.com/story/feds-williams-argues-against-using-monetary-policy-to-address-stability-concerns-2015-05-28).
He also said the Fed is likely to raise rates later this year,
reiterating Chairwoman Janet Yellen's view, expressed on
Friday.
At 2:45 p.m. Eastern Time, Minneapolis Fed President Narayana
Kocherlakota will give a speech on monetary policy in Helena, Mont.
Kocherlakota is not a voting member of the Fed's policy-setting
committee this year.
Speculation over the Fed rate hike has recently supported the
dollar, with the greenback (USDJPY) jumping to a 12-year high
against the yen
(http://www.marketwatch.com/story/dollar-taps-a-12-year-high-against-yen-2015-05-28)
on Thursday.
Earnings: Ahead of the bell, retailer Costco Wholesale
Corp.(COST) said third-quarter profit rose as it got a boost from
low gas prices, strong store sales and membership fees. Shares were
down 2% premarket.
Abercrombie & Fitch Co.(ANF) reported a wider-than-expected
loss during the first quarter. Shares dipped 2% premarket.
And after the closing bell, GameStop Corp.(GME) is forecast to
post first-quarter earnings of 59 cents a share.
Movers and shakers:Avago Technologies Ltd.(AVGO) said it would
buy rival chip maker Broadcom Corp.(BRCM) for $37 billion in cash
and stock. Shares of Broadcom were little changed ahead of the
bell.
NXP Semiconductors NV(NXPI) could also be active, after the
semiconductor manufacturer said it would sell its RF Power business
to Jianguang Asset Management Co. for $1.8 billion.
For more on today's notable movers read Movers & Shakers
column
(http://www.marketwatch.com/story/abercrombie-fitch-costco-gamestop-earnings-in-focus-2015-05-28).
Other markets: Chinese stocks fell the most in four months
(http://www.marketwatch.com/story/china-stocks-plunge-65-after-sovereign-fund-cuts-stakes-in-banks-2015-05-28),
with the Shanghai Composite Index down 6.5%. European stock markets
were also mostly lower
(http://www.marketwatch.com/storyno-meta-for-guid).
Oil (http://www.marketwatch.com/storyno-meta-for-guid)(CLN5) and
gold traded near unchanged.
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