U.S. Stocks May Extend Recent Upward Move In Early Trading

Stocks are likely to move to the upside in early trading on Thursday, extending the rally seen over the two previous sessions. The major index futures are currently pointing to a higher open for the markets, with the Dow futures up by 99 points.

Easing concerns about the Omicron variant of the coronavirus may contribute to continued strength on Wall Street, as separate studies have indicated the new strain poses a lower risk of severe disease and hospitalization than the Delta variant.

However, experts such as the World Health Organization have cautioned that it is too early to draw conclusions on the new variant’s severity.

Early trading may also be impacted by reaction to a slew of U.S. economic data, including a report from the Commerce Department showing a continued acceleration in the pace of core consumer price growth.

A reading on inflation said to be preferred by the Federal Reserve showed the annual rate of core consumer price growth accelerated to 4.7 percent in November from 4.2 percent in October.

The data was included as part of a Commerce Department report showing personal income and spending both increased in line with economist estimates in November.

The Labor Department also released a report showing first-time claims for U.S. unemployment benefits came in flat in the week ended December 18th.

The Labor Department said initial jobless claims were unchanged from the previous week’s revised level of 205,000. Economists had expected jobless claims to edge down to 205,000 from the 206,000 originally reported for the previous week.

A separate report released by the Commerce Department showed new orders for U.S. manufactured durable goods spiked much more than expected in the month of November.

The Commerce Department said durable goods orders surged up by 2.5 percent in November following a revised 0.1 percent uptick in October.

Economists expected durable goods orders to jump by 1.6 percent compared to the 0.4 percent drop that had been reported for the previous month.

Excluding a sharp increase in orders for transportation equipment, durable goods orders climbed by 0.8 percent in November after rising by 0.3 percent in October. Ex-transportation orders were expected to increase by 0.6 percent.

The data deluge continues shortly after the start of trading, with the Commerce Department scheduled to release its report on new home sales in the month of November. New home sales are expected to spike by 3.4 percent to an annual rate of 770,000.

The University of Michigan is also due to release its revised reading on consumer sentiment in December. The consumer sentiment index for December is expected to be unrevised from the preliminary reading of 70.4, which was up from 67.4 in November.

Stocks initially showed a lack of direction but moved sharply higher over the course of the trading day on Wednesday. With the upward move, the major averages extended the substantial rebound seen on Tuesday.

The major averages saw further upside going into the close, reaching new highs for the session. The Dow climbed 261.19 points or 0.7 percent to 35,753.89, the Nasdaq surged 180.81 points or 1.2 percent to 15,521.89 and the S&P 500 jumped 47.33 points or 1 percent at 4,696.56.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan’s Nikkei 225 Index advanced by 0.8 percent, while China’s Shanghai Composite Index rose by 0.6 percent.

The major European markets have also moved to the upside on the day. While the German DAX Index has climbed by 0.5 percent, the French CAC 40 Index is up by 0.3 percent and the U.K.’s FTSE 100 Index is up by 0.1 percent.

In commodities trading, crude oil futures are rising $0.34 to $73.10 a barrel after jumping $1.64 to $72.76 a barrel on Wednesday. Meanwhile, after climbing $13.50 to $1,802.20 an ounce in the previous session, gold futures are increasing $9 to $1,811.20 an ounce.

On the currency front, the U.S. dollar is trading at 114.30 yen versus the 114.10 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.1307 compared to yesterday’s $1.1326.

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