A mixed bag of economic data and some optimism ahead of today’s key monthly employment report sent U.S. stocks modestly higher on Thursday, with a rise in crude prices helping energy stocks erase losses recorded earlier in the session.
After its leap Wednesday, the Dow average tacked on six points as technology components Microsoft (NASDAQ:MSFT) and Cisco (NASDAQ:CSCO) showed some strength. Shares in both the companies rose more than 1.5%. However, dragging the index lower were Home Depot (NYSE:HD), JP Morgan (NYSE:JPM) and DuPont (NYSE:DD), all down more than 1%. JP Morgan fell on reports that UK’s Financial Services Authority has fined the bank $49.12 million for serious misallocation of finances.
The technology-laden Nasdaq outperformed with a gain of 1% and the broader S&P 500 index added 4 points or 0.4% on a day that witnessed erratic trading. Technology stocks closed mostly higher. Dell (NASDAQ:DELL) shares added almost 5% after CEO Michael Dell said he has considered privatizing the company.
This morning’s stock futures suggest markets would open sharply lower after the May employment report failed to match expectations. Ahead of the opening bell, Dow Jones industrial average futures are down 214 points, or 2.1%, at 10,044. Standard & Poor’s 500 index futures are down 26.30 points, or 2.4%, at 1,077.30, while Nasdaq 100 index futures are down 45 points, or 2.4%, at 1,852.75. Large derivatives losses at Societe Generale, which sent the euro to a fresh four-year low against the US dollar, are also weighing on the stock futures.
Same-store sales reports failed to lift sentiments yesterday, with about half of the firms’ reported comparable sales numbers falling below Street projections. Costco (NASDAQ:COST) and Target (NYSE:TGT) missed, while Gap (NYSE:GPS), Macy’s (NYSE:M) and Saks (NYSE:SKS) reported higher-than-expected numbers; Abercrombie and Fitch’s (NYSE:ANF) international sales surged 84%.
All but two of the S&P500’s ten industry sectors closed in the green yesterday, led by gains in oil and gas (+1.3%), technology (+1.2%), and utilities (+1.1%), followed by industrials (+0.7%), health care, (+0.6%), consumer services (+0.5%), consumer goods (+0.4%), telecommunications (+0.1%). Basic material shares dropped 1.3% on China growth concerns; financials dropped 0.4%.
Notwithstanding talks of euro holding near a support level of $1.22, the currency reversed course, and fell to $1.216 from Wednesday’s $1.225. Meanwhile, Dallas Fed President Fisher, Atlanta Fed President Lockhart and Kansas City Fed President Hoenig sounded more hawkish on the need to raise interest rates.
