Stock futures strengthen after labor market data
Jobless claims fall to the lowest level since Feb. 2008. S&P downgrades Spain's debt. Citigroup raises US equities to overweight. Ruby Tuesday reports an in-line profit.
By Andrea Tse
U.S. stock futures were gaining ground Thursday as investors cheered a better-than-expected report on labor market conditions and shrugged off Standard & Poor's two-notch downgrade of Spain's debt.
Moody's, which already has Spain on watch to be downgraded to junk status, will likely go next, according to Stephen Guilfoyle, U.S. economist at Meridian Equity Partners.
"The perception … is that this or these downgrades make it that much easier for Spain to ask for the help they need when their huge debt bill comes due in about 10 days," said Guilfoyle. "By Spain asking for help, the ESM can then purchase Spanish sovereign debt in the primary market, and the ECB can then activate their OMT program to buy said debt in the secondary market. The provided liquidity will take the pressure off of the throat of Spain, at least for now, kicking that proverbial can a much further ways down that road."
Market sentiment also got an early boost with Citigroup strategists raising their recommendation on U.S. equities to overweight and calling for a global rally through the end of 2013, citing a combination of strong earnings per share momentum and aggressive central bank stimulus plans.
Futures for the Dow Jones Industrial Average ($INDU) were up by 51 points at 13,319. S&P 500 ($INX) futures were up by 7.4 points at 1,433. Futures for the Nasdaq ($COMPX) were rising by 16.75 points to 2,739.
The Labor Department reported that initial jobless claims in the week ended Oct. 6 fell 30,000 to 339,000 from the previous week's upwardly-revised figure of 369,000, the lowest level since Feb. 2008.
The four-week moving average was 364,000, a decrease of 11,500 from the prior week's average of 375,500.
Continuing claims for the week ended Sept. 29 was 3.273 million, a decrease of 15,000 from the preceding week's upwardly-revised level of 3.288 million.
Economists on average predicted initial jobless claims of 370,000 and continuing claims of 3.275 million.
The Census Bureau reported that the U.S. trade deficit widened to $44.22 billion in August from $42.47 billion in July. Economists were expecting a U.S. trade deficit of $44 billion.
The Bureau of Labor Statistics said that U.S. import prices rose 1.1% in September versus 1.1% in August and that export prices increased 0.8% in September compared with 1% in August.
The major U.S. equity averages finished sharply lower on Wednesday as the early results for third-quarter reporting season exacerbated investor worries about a slowing global economy.
The FTSE 100 in London was up 0.46% and the DAX in Germany was higher by 0.66% Thursday. The Nikkei Average in Tokyo closed down 0.58% and the Hang Seng in Hong Kong finished up 0.38%.
November crude oil futures were rising 62 cents at $91.87 a barrel. December gold futures were adding $5.80 at $1,770.90 an ounce.
The benchmark 10-year Treasury was down 4/32, lifting the yield to 1.693%. The dollar was up 0.02%, according to the dollar index.
In corporate news, JPMorgan Chase's (JPM) chief financial officer, Douglas Braunstein, is expected to step down over the next two quarters and is likely to move into a different job at the bank, The Wall Street Journal reported, citing people close to the company.
Caterpillar (CAT) stock was cut to sector perform from outperform at RBC Capital, whose analysts pointed to high inventory levels for both the company and the earth-moving equipment industry as a whole, and sluggishness in Europe and China.
Ruby Tuesday (RT), the restaurant operator, reported an in-line profit for its fiscal first quarter on Wednesday but gave an outlook that hints at some downside to Wall Street expectations for the full year.
Hewlett-Packard's (HPQ) position as the top seller of personal computers has come to an end with Lenovo as the new leader, according to Gartner figures.
Soft drink giant Coca-Cola (KO) is reportedly is in talks to invest around $10 million in subscription music-streaming service Spotify.
Walt Disney (DIS) is facing a lawsuit by Stan Lee Media over rights to Marvel characters such as Spider-Man and Iron Man.
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Lyin' Ryan is getting an a$$ whooping from Biden, just as predicted and expected. Stupid useless Repuklican imbeciles! LMAO
Barack Obama in 2012!
Chris Van Hollen in 2016 & 2020!
God bless America!
Mr Etch a sketch, Mr Flip Flop and all his MaLarky has been outted.
See him and all his MaLarky on You tube Romney Flip Flop.
Simpson n Bowles just today said there shouldn't be any increase in Defense spending or it will 'BUCKLE' the economy. They also said if Congress doesn't act on the Fiscal Cliff soon there will be irreversible damage to the economy.
Can you hear them now..... Mr Romney ????
Not an option any longer. The slower motion indicates a hidden variable. At least you are pro-active with yours. Most think they can either ride out a leap off the cliff or beat a super-computer.
Well.....Hope we aren't faced with a big YO_YO today..?
Maybe something decent to the upside....Most the News is just blase..Or Rinse and Repeat..
Let's go a half percent to the good side..
And quit worrying about unimportant subjects..That don't really effect the Markets that much.
Quit worrying about scumbags and manipulators..
And let's move on with making America better..
I'm guessin' we'll see the S&P above 1,500 by then.
It's actually a near-identical pattern everyday. Banks borrow from the Fed on Monday and watch it go bust the rest of the week. Around noon everyday, someone wakes up and switches the program so it looks like they aren't the only player. At 3 pm everyday, the fish lines out for suckers gets drawn in. There are no markets, no economy... just big banks big CEO manipulation and big law firm clients in control.
By end of year maybe 1500...It's taken a long time to get here....Corrections keep adjusting..
But trends are still intact.....And going across 500 companies,takes upside in many of them.
Not weighted like the DOW or Nasd....Where just a handful of companies can make a huge diff.
All the numbers are not impacting to the downside, only a gentle trending upward. Anecdotal, but many business folks here are starting to feel good again AND some industries are expanding .
RR is right, we have to work our way past the toxic collateral damage from the election era garbage to arrive at an unpoliticized market again.
Looking forward to it.
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[BRIEFING.COM] Everyone was waiting for the November employment report all week, and with the major averages all up at least 0.9%, it is pretty clear what the market thought of that report. It liked what it saw, because the data were solid enough to suggest the labor market is certainly improving but not strong enough necessarily to force the Fed's hand into tapering at this month's meeting.
That middle-line view was perhaps best reflected in the Treasury market, which moved higher after ... More
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