By Peter Nurse
Investing.com - U.S. stocks are seen opening lower Thursday, adding to Wednesday’s sharp losses amid rising concerns the Federal Reserve may pare back its ultra-easy monetary policies sooner rather than later.
At 7:05 AM ET (1205 GMT), the Dow futures contract was down 155 points, or 0.4%, S&P 500 futures traded 11 points, or 0.3%, lower, and Nasdaq 100 futures dropped 35 points, or 0.3%.
The blue-chip Dow Jones Industrial Average on Wednesday fell almost 700 points, or 2%, its weakest day since January, the S&P 500 lost 2.1%, its biggest one-day drop since February, while the tech-heavy Nasdaq Composite slid 2.6%.
This has been Wall Street’s worst week in six months on concerns increased inflation levels will pressure the Fed into raising interest rates more promptly than the central bank has guided.
The economic data slate also commands attention Thursday, with the weekly jobless claims, at 8:30 AM ET (1230 GMT), the main release, especially after last week’s disappointing jobs report for April and record job opening numbers earlier this week.
Economists are calling for 490,000 initial claims, below 500,000 for the second straight week, helped by the ramped-up vaccination program and widespread easing of social distancing restrictions.
The latest factory gate price data are due at the same time, with the annual PPI figure expected to rise to 5.9% from 4.2% the previous month.
In the corporate sector, Disney (NYSE:DIS) releases its quarterly results after the close, and investors will be looking for the entertainment giant’s guidance for the rest of the year now that Disneyland has reopened and tourists are traveling again.
Tesla (NASDAQ:TSLA) will also be in the spotlight after CEO Elon Musk said the electric car manufacturer is suspending the use of bitcoin as a method to purchase its vehicles, citing concerns about the impact on the environment from mining for the cryptocurrency.
Oil prices weakened Thursday, after Colonial Pipeline began to slowly restart the nation's largest fuel pipeline network, lifting concerns of a lengthy shortage of fuel to major population centers on the east coast of the U.S.
Adding to the negative tone, the U.S. Energy Information Administration reported a draw of 427,000 barrels in crude oil inventories for the week ending May 7. This was a smaller drop than the 2.82-million-barrel draw expected, as well as the near 8-million-barrel reduction recorded during the previous week.
U.S. crude futures traded 1.7% lower at $64.97 a barrel, the Brent contract fell 1.6% to $68.22.
Additionally, gold futures fell 0.3% to $1,817.35/oz, while EUR/USD traded flat at 1.2069.