Finance News

Inventory futures have barely modified after the fourth day of loss after Dow, S&P

US stock index futures were little changed during Thursday's overnight trading after stocks posted losses for a fourth straight day.

Futures contracts linked to the Dow Jones Industrial Average rose 15 points. S&P 500 futures and Nasdaq 100 futures were also little changed.

During regular trading, the Dow lost around 150 points, or 0.43%, while the S&P lost 0.46%. It was the fourth consecutive day of losses for both of them. The Nasdaq Composite lost 0.25% on its second consecutive day of losses. It is the first time since mid-August that the tech-heavy index has seen consecutive losses.

All three indices are well on their way to ending the week in the red.

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A better-than-expected weekly number of jobless claims capped Thursday's losses. The Department of Labor said first-time jobless claims fell to 310,000 in the previous week, the lowest level since the pandemic broke out. Economists surveyed by Dow Jones expected 335,000 copies to be printed.

In the shortened vacation week, the cyclical consumer goods sector is the top performing S&P group with a plus of around a quarter percent. The other ten sectors are all in the red. Industrial and real estate stocks are the biggest losers, with each sector losing more than 2%.

Markets are on hold until there is more clarity about the Federal Reserve's next move. The central bank will begin a two-day session on September 21, and the street will be on the lookout for an update on the Fed's bond-buying program. On Thursday, the European Central Bank left its monetary policy unchanged but said it would slow the pace of its asset-buying program.

"The pace of monetary policy changes will be gradual enough not to affect the economic recovery or the equity rally, while the disparities between the more restrictive and cautious central banks will create opportunities," said Mark Haefele, chief investment officer of UBS Global Wealth Management.

"We expect the major central banks to continue to support growth and keep rates low for longer. This is positive for equity markets, especially for cyclical and high-value areas of the market," he added.

Despite Thursday's losses, the major averages are still hovering around their all-time highs. The Dow is about 2% below its record, while the Nasdaq and S&P are about 1% off theirs.

"New highs in the market are not an issue as long as they are supported by fundamentals," Keith Lerner, co-chief investment officer at Truist, wrote in a recent customer announcement. "The biggest driver of stock returns this year has been capital E earnings. This is in line with one of our key themes last year that the earnings power of American companies was underestimated," he added.

The second quarter earnings season is largely in the rearview mirror. But earnings reports are still seeping through, with Kroger on deck before Friday's opening bell.

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