Market Snapshot: U.S. stocks poised to hold near records ahead of string of economic reports

Market Snapshot: U.S. stocks poised to hold near records ahead of string of economic reports

U.S. stock-index benchmarks looked set for a skittish start on Thursday as investors fought to shake off disputes between China and the U.S. to focus on mostly strong corporate earnings and a healthy economic backdrop.

A series of employment reports on the labor market, U.S. inventories and inflation set for later in the morning may provide more insight about the state of the economy as the S&P 500 and the Nasdaq remain within a hair’s breadth of fresh all-time highs.

How are benchmarks performing?

Futures for the Dow Jones Industrial Average YMU8, +0.09% were trading virtually unchanged at 25,540, those for the S&P 500 index ESU8, +0.13%  also were near the flatline around 2,857, while futures for the Nasdaq-100 NQU8, +0.14% were up less than 0.1% at 7,478.75.

On Wednesday, the S&P 500 index SPX, -0.03% broke a four-day win streak by closing fractionally lower at 2,857.70, holding less than 0.5% from its all-time high hit on Jan. 26.

Declines in consumer staples, energy and industrials offset modest gains in the technology, financials and health-care sectors.

The Nasdaq Composite Index COMP, +0.06%  advanced 4.66 points, or less than 0.1%, to 7,888.33, extending its series of wins to seven, its longest stretch of uninterrupted gains since March 12. Recent advances took the benchmark within about 50 points of it record close set on July 25.

The Dow Jones Industrial Average DJIA, -0.18%  declined 45.16 points, or 0.2%, to 25,583.75.

For the week, the Dow is set to gain 0.5%, the S&P 500 is on pace to advance by 2.6% and the Nasdaq is on track for a weekly return of 1.7%, as of Wednesday’s close.

What’s driving the market?

Stock markets in the U.S. have remained relatively resilient despite trade tensions between Washington and Beijing running hot in the background. On Wednesday, China warned that duties imposed by President Donald Trump’s administration on some $50 billion of Chinese imports set to be enacted on Aug. 23, would be matched and China’s Ministry of Commerce said that the country “has to retaliate as necessary.”

However, after getting knocked lower on Wednesday China markets also have shown some bounce back, with Shanghai Composite Index SHCOMP, +1.83% gained 1.8% and the Shenzhen A Share index 399106, +2.65%  surging by 2.7%, a rise that could help provide some signs, at least momentarily, to U.S. investors that the market of the world’s second-largest economy isn’t unraveling on trade clashes as it also battles a domestic slowdown.

Catching investors’ attention early Thursday were new sanctions on Russia over a nerve-agent attack, which knocked the Russian ruble USDRUB, +0.5898% and Moscow markets RSX, -4.09% ERUS, -4.22%  lower.

Wednesday’s trade action was marked by weakness in the energy sector, as crude-oil futures for the U.S. CLU8, +0.03% fell to a nearly 7-week low, and earnings from prominent companies, including Walt Disney Co. DIS, -2.21% came in weaker than estimated.

However, bullish market participants believe that quarterly results have been stellar and the domestic economy is sufficiently strong to take aim at new highs, even as the bull market approaches its 10th year.

What data are ahead?
  • A report on weekly jobless claims is due at 8:30 a.m. Eastern Time for the period ended Aug. 4, with 217,000 claims expected
  • Producer-price index for July is due also at 8:30 a.m. A gain of 0.2% is estimated.
  • A report on wholesale inventories for June is scheduled for 10 a.m.
  • Chicago Fed President Charles Evans is slated to speak about economic conditions and policy at 9:30 a.m. with the press in Chicago, with an embargoed release of that interview set for 1 p.m. Eastern.
Which stocks are in focus?

Rite Aid Corp. RAD, +1.16%  shares are likely to be in focus after a merger between the retailer and Albertsons Cos. was called off on Wednesday. Shares of Rite Aid were down nearly 3% in the premarket.

What are market participant’s saying?

“Investors in Asia largely brushed off the ongoing trade fight between China and the U.S., with Shanghai’s blue-chip stocks climbing 2.4%, a move supported by the tech and financial sectors. Solid economic data and possible government intervention through monetary & fiscal policies encouraged investors to take some risk on Thursday,” wrote Hussein Sayed, chief market strategist at FXTM.

“However, if President Trump goes ahead with his proposed tariffs of 25% on $200 billion worth of Chinese imports, these gains will be rapidly wiped off,” he said.

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