Stock futures were flat on Thursday as Wall Street awaited the latest data on weekly U.S. jobless claims.
Futures on the Dow Jones Industrial Average were up just 23 points, indicating a loss of 53 points at the open. S&P 500 and Nasdaq 100 futures traded slightly lower.
Economists are expecting an increase of 5 million, which would build on the record-shattering prior two readings of 6.6 million and 3.3 million. Economists forecast that the unemployment rate will jump into the teens this month, from March’s 4.4% level and the 3.5% it was at in February.
The latest unemployment data will follow a surge in the stock market that took place on Wednesday. The rally was fueled in part by Sen. Bernie Sanders dropping out of the presidential race, as well as hopes that the coronavirus outbreak may soon turn a corner.
Both the Dow and S&P 500 gained more than 3% on Wednesday. The Nasdaq jumped 2.6%. Wednesday’s rally put the S&P 500 and Dow up more than 10% each for the week while the Nasdaq was up 9.7%.
But some believe that stocks are now getting ahead of themselves and investors should exercise caution.
“I think this is kind of buy the rumor and potentially we sell the news when reality sets in of what we are going to see what’s on the other side,” billionaire investor Mark Cuban said Wednesday on CNBC’s “Closing Bell.”
“I think people are naturally optimistic right now in terms of the market. I just don’t think they’re really factoring in what we’re going to see on the other side,” he added.
After Wednesday’s rally, the Dow is up 29% from its low and the Nasdaq Composite is down less than 10% this year.
“The stock market is at a very uncertain point now. The impact of the coronavirus on future earnings is yet to be determined. We aren’t out of the woods,” said Nancy Davis, chief investment officer at Quadratic Capital.
Federal Reserve Chairman Jerome Powell is also set to speak on Thursday. His remarks follow the release of the minutes from the Federal Open Market Committee’s emergency meeting in March, which is when the central bank slashed interest rates to near zero.
The minutes revealed that the Fed is prepared to keep rates near zero until the economy has “weathered” the coronavirus impact.
“With regard to monetary policy beyond this meeting, these participants judged that it would be appropriate to maintain the target range for the federal funds rate at 0 to 1/4 percent until policymakers were confident that the economy had weathered recent events and was on track to achieve the Committee’s maximum employment and price stability goals,” the statement said.
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Stock futures were flat on Thursday as Wall Street awaited the latest data on weekly U.S. jobless claims.