Stock Futures Edge Higher Ahead of Jobless Data
By Joe Wallace
U.S. stock futures ticked higher Thursday ahead of jobs data
that are expected to show the economic recovery gained more
momentum in recent weeks.
Futures for the S&P 500 ticked up 0.2%. Contracts for the
Dow Jones Industrial Average also edged up 0.2%, a day after the
blue-chip index closed at a record for the 22nd time this year.
Futures for the technology-focused Nasdaq-100 rose 0.4%.
Major U.S. indexes stand at or close to all-time highs,
bolstered by a surge of economic growth and corporate earnings as
restrictions on some activities are relaxed. Some investors say the
speed of the U.S. recovery, which stands in contrast to some other
regions where Covid-19 vaccines aren't as widespread, will keep
stocks on an upward trajectory.
"We should see cash flows and company cash flows really improve,
especially with the reopenings happening," said Mary Nicola, a fund
manager at PineBridge Investments. Although valuations are high,
stocks remain attractive compared with low-yielding bonds, she
Data due at 8:30 a.m. ET are expected to show that filings for
jobless benefits, a proxy for layoffs, fell to 527,000 last week.
That would bring the four-week average to its lowest point since
the pandemic took hold, a signal the labor-market rebound is
First-quarter results from Moderna, CBS, Blue Apron and Kellogg
are due before the opening bell. News Corp., The Wall Street
Journal's parent company, and Beyond Meat are scheduled to report
earnings after markets close.
Companies have blown past forecasts so far this earnings season.
Of the 381 companies on the S&P 500 that had reported through
Wednesday, 84% had topped analysts' expectations, according to
Yet many companies beating forecasts have seen a lackluster
response in their share price. Some investors say that is a sign,
alongside recent volatility in tech stocks, that the rally that
began last March is beginning to flag.
"Although the S&P is just 1% off its high, I think equity
markets are beginning to look very fatigued," said Paul O'Connor,
head of multiasset investments at Janus Henderson.
Indicators including surveys by the American Association of
Individual Investors suggest investors are almost uniformly
bullish, a setup that tends to precede a pullback in stocks,
according to Mr. O'Connor. "There are such high expectations
embedded in markets that we're going to need a steady stream of
good news just to maintain the current prices," he said.
In overseas markets, the Stoxx Europe 600 edged up 0.1% and is
hovering close to its record closing level. Gains for
food-and-beverage stocks offset losses for shares of travel,
leisure and tech companies.
Société Générale was among the best-performing stocks in the
region, gaining over 6% after the French bank reported the best
quarter for its markets business in years. Vestas Wind Systems fell
4% after the Danish wind-turbine maker posted a net loss for the
Copper prices continued to advance, climbing 0.8% to $10,006 a
metric ton on the London Metal Exchange. Rising commodity prices
have bolstered expectations for a pickup in inflation.
In Asia, Japan's Nikkei 225 rose 1.8% by the close and China's
Shanghai Composite slipped 0.2%.
Shares of Shanghai Fosun Pharmaceutical and other Asia-based
pharmaceutical companies tumbled after the U.S. said it would
support a temporary waiver of intellectual property rights of
Covid-19 vaccine makers. Hong Kong-listed shares of Shanghai Fosun
closed 14% lower.
--Ronnie Harui contributed to this article.
Write to Joe Wallace at Joe.Wallace@wsj.com
(END) Dow Jones Newswires
May 06, 2021 05:04 ET (09:04 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.