Futures rise faster than jobless claims data, Tesla jumps – Reuters

Futures rise faster than jobless claims data, Tesla jumps - Reuters
  • Futures Up: Dow 0.21%, S&P 0.45%, Nasdaq 0.74%

Dec 29 (Reuters) – US stock index futures gained on Thursday ahead of labor market data that will provide clues to future rate hikes, as Tesla extended earnings after top boss Elon Musk told staff to ignore the “stock market frenzy”.

The shares of the electric vehicle maker (TSLA.O) rose 5.3% in premarket trading after Musk’s comment. They posted seven loss sessions on Wednesday, but the sell-off over the year has led to a 70% drop in the share’s value.

Major technology and growth stocks such as Apple Inc (AAPL.O)Alphabet Inc (GOOGL.O)Meta Platforms Inc (META.O) and Amazon.com Inc (AMZN.O) rose between 0.7% and 1%, aided by a decline in 10-year Treasury yields.

“There is an element of dip-buying going on, but it seems to be mostly focused on technology stocks right now,” said Stuart Cole, chief macroeconomist at Equiti Capital.

“Due to low liquidity, this purchase is likely to have a greater impact than would normally be the case.”

Major Wall Street indices fell more than 1% on Wednesday, along with the Nasdaq (.IXIC) bottomed out in 2022 as rising COVID cases in China and geopolitical tensions heightened fears of a likely recession in 2023.

On the data front, the U.S. Labor Department report is expected to show that 225,000 Americans filed for unemployment last week, up from 216,000 the previous week, indicating some weakness in an otherwise tight job market.

A strong labor market and resilient US economy have fueled concerns that interest rates could stay high for longer, even as easing inflationary pressures keep hopes of smaller increases alive.

The Fed’s aggressive tightening of monetary policy to curb decades of high inflation has hammered stocks this year, with the benchmark S&P 500 (.SPX) lost 20% and tech-heavy Nasdaq lost nearly 35% in value.

However, investors’ preference for high-dividend-yielding stocks closely linked to economic health has averted a sharper fall in the Dow Jones, which weighs heavily on the industry. (.DJI)a decrease of only 9.5% on the year.

Markets are now counting on a 69% chance of a 25 basis point rate hike by the US Federal Reserve at its February meeting and see interest rates peak at 4.93% in the first half of next year. .

At 6:18 a.m. ET, Dow e-minis were up 70 points, or 0.21%, S&P 500 e-minis were up 17 points, or 0.45%, and Nasdaq 100 e-minis were up 80.25 points, or 0.74% increased.

Reporting by Ankika Biswas and Amruta Khandekar in Bengaluru; Edited by Arun Koyyur

Our standards: The Thomson Reuters Principles of Trust.

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