Benzinga - by Shanthi Rexaline, Benzinga Editor.
Wall Street stocks are expected to open with a mixed start on Thursday after experiencing four consecutive sessions of gains. Additional economic data is anticipated, providing insights into the strength of the economy and its near-term monetary policy direction. Traders will closely watch the personal income and spending report for July, which includes the Federal Reserve‘s preferred inflation gauge. Additionally, more tech earnings are scheduled to be released after the market closes, and investors will also have the opportunity to hear from a Fed official before the market opens.
Cues From Wednesday's Trading:
Buying interest perked up on Wednesday, as traders received the bad economic news they were hoping for. ADP private payrolls survey showed that job gains in the private sector slowed notably in August, and the preliminary second-quarter GDP report showed a downward revision to the previously reported number of 2.1%.
Stocks opened the session on a mixed note and saw a sharp spike upward immediately after, as traders digested the weak data. Although buying momentum tempered thereafter, the averages spent the better part of the session above the unchanged line before closing modestly to moderately higher. The Nasdaq Composite closed above the psychological resistance of 14,000 and ended at a one-month high.
Most sectors, with the exception of the defensive healthcare and utility stocks, gained ground in the session.
US Index Performance On Wednesday
| Index | Performance (+/-) | Value |
| Nasdaq Composite | +0.54% | 14,019.31 |
| S&P 500 Index | +0.38% | 4,514.87 |
| Dow Industrials | +0.11% | 34,890.24 |
| Russell 2000 | +0.40% | 1,903.21 |
Analyst Color:
It's too early to call for the party despite the recent reversal in sentiment in the stock market, going by comments of Morgan Stanley's Lisa Shalett. The analyst highlighted three risks that necessitate caution among investors. The real Treasury rates have surged, which could pressure stock valuations, and the deteriorating Chinese economic growth could weigh down on the global economy and the U.S. multinational corporations, she said.
Additionally, the analyst said the U.S. economic data continues to be mixed.
“All told, we are not out of the woods yet,” says Shalett. “With stock indices likely to stay close to their current range over the next few quarters, investors should ensure their portfolios are not too heavily weighted in any particular sector, and balance equity exposure between offense and defense, with a focus on quality,” she added.
Futures Today
Futures Performance On Thursday
| Futures | Performance (+/-) |
| Nasdaq 100 | -0.12% |
| S&P 500 | +0.07% |
| Dow | +0.32% |
| R2K | -0.05% |
In premarket trading on Thursday, the SPDR S&P 500 ETF Trust (NYSE:SPY) rose 0.13% to $451.58 and the Invesco QQQ ETF (NASDAQ:QQQ) edged down 0.03% to $376.75, according to Benzinga Pro data.
Upcoming Economic Data:
Challenger, Gray & Christmas' report on job cuts for August is due at 7:30 a.m. EDT. In July, job cuts fell 8% year-over-year and 42% month-over-month to 23,697.
The Bureau of Economic Analysis will release its personal income and spending report for July at 8:30 a.m. EDT. Personal income and spending may have risen 0.3% and 0.7% month-over-month compared to June's 0.3% and 0.5% increases, respectively. The annual rate of the core price consumption expenditure index, which is the Fed’s favorite inflation gauge, may have cooled off from 4.2% to 4.1%.
The Labor Department is scheduled to release its customary weekly jobless claims data at 8:30 a.m. EDT. Economists, on average, expect the number of individuals claiming unemployment benefits to come in at 235,000 in the week ended Aug. 26 compared to 230,000 in the week ended Aug. 19.
Boston Fed President Susan Collins is scheduled to speak at 9 a.m. EDT.
The ISM-Chicago will release the results of its regional business survey at 9:45 a.m. EDT. The Chicago region's business barometer for August is expected to increase from 42.8 in July to 44.1 in August, suggesting the sector is still in contraction territory. A reading above “50” points to expansion.
The Dallas Fed's PCE index for July is due at 10 a.m. EDT, with the consensus estimating a 3.90% rate.
The Treasury will auction four- and eight-week bills at 11:30 a.m. EDT.
See also: How To Trade Futures
Stocks In Focus:
- Salesforce, Inc. (NYSE:CRM) rallied nearly 5.5% in premarket trading following the release of its quarterly results.
- Other stocks reacting to earnings include Okta, Inc. (NASDAQ:OKTA) (up over 11%), Chewy, Inc. (NYSE:CHWY) (down about 4.50%) and Victoria’s Secret & Co. (NYSE:VSCO) (down over 5%) and Five Below, Inc. (NASDAQ:FIVE) (down about 6%).
- Palantir Technologies, Inc. (NYSE:PLTR) fell over 4% following a bearish recommendation from Morgan Stanley.
- Campbell Soup Co. (NYSE:CPB), Ciena, Inc. (NASDAQ:CIEN), Dollar General Corp. (NYSE:DG), Signet Jewelers Ltd. (NYSE:SIG), Genesco, Inc. (NYSE:GCO), Hormel Foods Corp. (NYSE:HRL) and Ollie's Bargain Outlet Holdings, Inc. (NASDAQ:OLLI)are among the companies due to release their quarterly results before the market open.
- Those reporting after the close are Broadcom, Inc. (NASDAQ:AVGO), Dell Technologies, Inc. (NYSE:DELL), Nutanix, Inc. (NASDAQ:NTNX), Lululemon Athletica, Inc. (NASDAQ:LULU), MongoDB, Inc. (NASDAQ:MDB), VMware, Inc. (NYSE:VMW), Oxford Industries, Inc. (NYSE:OXM), PagerDuty, Inc. (NYSE:PD) and SentinelOne, Inc. (NYSE:S).
Crude oil futures rose 0.56% to $82.09 in early European session on Thursday, adding on to the 0.58% gain on Wednesday.
The benchmark 10-year Treasury note fell 0.016 percentage points to 4.102% on Thursday.
Major Asian markets had another mixed outing on Thursday, with Chinese and Hong Kong markets declining yet again amid growth worries. The Indian, South Korean, Indonesian, and Taiwanese stocks also moved to the downside, while the Japanese market advanced on the back of some strong domestic data.
The Australian, New Zealand, and Singaporean markets also ended higher.
European stocks were also mixed in late-morning trading on Thursday, as traders digested the eurozone inflation data.
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