By Anora Mahmudova and Carla Mozee, MarketWatch
Weekly jobless claims drop to lowest level in 7 weeks
NEW YORK (MarketWatch) -- U.S. stock futures pointed to a
slightly higher open on Wall Street Wednesday, building on five
straight days of advances that sent both the S&P 500 and Dow
industrials to record levels.
Futures for the S&P 500 (SPH5) were up 1.8 points at
2,080.70, and those for the Dow Jones Industrial Average (DJH5)
gained 15 points, or 0.1%, at 17,991. Nasdaq 100 futures (NDH5)
rose 5 points, or 0.1%, to 4,283.
Investors will wrap up the trading day early, with both the New
York Stock Exchange and the Nasdaq Stock Market closing at 1 p.m.
Eastern Time. The markets will remain closed Thursday for Christmas
Day, and will reopen Friday with normal hours.
Market reaction to better-than-expected weekly jobless claims
was minimal. The number of people who applied for U.S.
unemployment-insurance benefits fell by 9,000 to 280,000 in the
week that ended Dec. 20, a seven-week low and only modestly above a
14-year low, according to Labor Department data released
Wednesday.
Recent employment data has indicated strengthening in the labor
market, which, in turn, should support the consumer-driven U.S.
economy. Third-quarter U.S. gross domestic product growth was
revised up to a 5% annualized rate, powered by consumer spending,
the Commerce Department said Tuesday.
Following the GDP reading -- the highest pace of growth in 11
years -- U.S. stocks finished higher. The Dow Jones Industrial
Average (DJI) closed above 18,000 for the first time, in the
fifth-fastest 1,000-point rise in the Dow's history.
The Dow at 18,000 before the end of 2014 is "extremely
encouraging", considering the "January Effect" which is the theory
that "markets will rally even more when we get in to 2015, as
investors pile back in to the equity market," said Neal Gilbert,
senior market analyst, at Forex.com, in a Tuesday note.
The Dow reaching 20,000 by February may be a stretch, but not
entirely out of reach, said Gilbert.
"As bold as I'd like to get, the daily trend-line resistance
indicates that 20,000 won't be achieved until late [third quarter
of 2015], so we may have a little time to wait before we start
breaking out our Jules Verne-themed balloons," he wrote.
Oil: At 10:30 a.m. Eastern Time, the Energy Information
Administration is expected to report a drawdown of 2.4 million
barrels from U.S. crude-oil inventories for the week ended Dec. 19,
according to a Platts survey. If the EIA reports a decline in oil
stocks, that would be in contrast to late Tuesday data from the
American Petroleum Institute, which showed crude inventories rose
5.4 million barrels last week.
Oil prices, which have been volatile in recent weeks on
oversupply concerns, moved lower on Wednesday. West Texas
Intermediate crude futures for February delivery (CLG5) fell nearly
2%, to $56 a barrel. Brent crude futures also dropped more than 2%,
to $60.29 a barrel.
Stocks to watch: Surgical-implants maker Stryker Corp. (SYK) is
preparing a bid for U.K.'s medical-devices maker Smith & Nephew
PLC , according to a Bloomberg report.
Shares of Cal-Maine Foods Inc. (CALM) could see active trading
after the company reported disappointing results for its fiscal
second quarter on Tuesday.
Other markets: In Asia, Japan's Nikkei Average rose 1.2%, while
Hong Kong's Hang Seng Index ended up a more modest 0.1%. European
stock markets were mixed ahead of the Christmas break. Gold futures
(GCG5) were down slightly, less than $1 an ounce.
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