Stock Futures Pause Ahead of Jobless Data
April 22 2021 - 4:18AM
Dow Jones News
By Joe Wallace
U.S. stock futures paused Thursday ahead of another batch of
earnings and data that will give investors fresh insights into the
economic recovery.
Futures for the S&P 500 ticked down less than 0.1%.
Contracts for the Dow Jones Industrial Average were flat. Futures
on the technology-heavy Nasdaq-100 index were marginally
higher.
Stocks jumped higher on Wednesday, erasing most of their losses
from earlier in the week. Many investors remain upbeat about the
outlook for shares, but are growing concerned that a surge in
coronavirus cases globally could delay plans to reopen economic
activity. India on Thursday reported the world's biggest one-day
rise in new infections.
"It wouldn't take much news for [investors] to start ripping up
their reopening playbook," said Christopher Jeffery, head of
inflation and rates strategy at Legal & General Investment
Management. "The market has gone from a world of not questioning it
to starting to question it," he said, adding that his team is
following the rise in cases in Michigan closely.
Earnings season continues apace. AT&T, Southwest Airlines,
American Airlines Group and Blackstone Group are among those due to
report results before the bell. Earnings from Intel and Snap are
scheduled for after markets close.
At 8:30 a.m. ET, data on filings for jobless benefits are
expected to show that claims last week remained near their lowest
level since the start of the pandemic. Economists forecast that
initial unemployment claims, a proxy for layoffs, edged higher to
603,000. That would add to evidence of a strengthening labor market
and overall economic recovery.
Bond yields continued to slide. The yield on 10-year U.S.
Treasury notes ticked down to 1.561% from 1.566% Wednesday. Yields,
which move in the opposite direction to bond prices, have fallen
from a high of 1.749% in late March.
Jason Borbora-Sheen, multiasset portfolio manager at Ninety One,
said he expects the broad stock market to trend sideways or decline
over the next few months. "Things have become quite overbought," he
said.
One of the two funds Mr. Borbora-Sheen manages has bought put
options to protect against downward moves in stocks. Puts are
contracts that pay out if the underlying asset falls below a
certain price.
In overseas markets, shares of tech and food-and-beverage
companies led the Stoxx Europe 600 up 0.5%.
Shares of Credit Suisse Group fell 4.8% after the Swiss lender
said it would issue new shares after losses from Archegos Capital
Management wiped out a strong first quarter. Renault shares lost
2.3% after the French car maker said revenue fell in the first
quarter.
https://www.wsj.com/articles/credit-suisse-taps-investors-for-cash-after-archegos-loss-widens-11619070830
The euro held steady at $1.204 ahead of a monetary-policy
decision by the European Central Bank. The bank isn't expected to
change interest rates or its bond-buying program. It will publish a
statement at 7:45 a.m. ET, after which ECB President Christine
Lagarde will hold a press conference.
Ms. Lagarde might refer to the recent uptick in European
government bond yields, according to Mr. Jeffery of Legal &
General. However, he doesn't expect policy makers to push back
against higher yields because the increase has been driven by
higher inflation expectations.
Turkey's lira dropped 1.4% to trade at 8.31 per dollar. The
latest slide in the currency came after U.S. officials said
President Biden is poised to declare that the massacres of
Armenians in the early 20th century constituted genocide, a step
that would further inflame ties with Ankara.
In Asia, chemical and pharmaceutical stocks helped Japan's
Nikkei 225 climb 2.4% by the close. China's Shanghai Composite
Index ticked down 0.2%.
Write to Joe Wallace at Joe.Wallace@wsj.com
(END) Dow Jones Newswires
April 22, 2021 05:03 ET (09:03 GMT)
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