Futures contracts tied to the major U.S. stock indexes clawed back most of their earlier losses on Thursday morning amid massive monetary stimulus from the European Central Bank.
Dow Jones Industrial Average futures traded just above the flatline after dropping more than 100 points earlier in the session. S&P 500 and Nasdaq 100 futures were well off their lows, trading down 0.3% and 0.1%, respectively.
The ECB said Thursday it will increase its Pandemic Emergency Purchase Programme by 600 billion euro, bringing the program’s total to more than 1 trillion euro. The ECB’s stimulus measures come as the Federal Reserve and other central banks around the world take action to curb the economic blow from the coronavirus pandemic.
These measures, along with hopes of the global economy reopening, have lifted equity prices around the world. The iShares MSCI ACWI ETF — which tracks stocks globally — has rallied more than 40% since hitting an intraday low on March 23. The S&P 500, meanwhile, is up over 42% in that time.
The market is “focusing on signs that a reopening recovery–juiced by federal spending and monetary easing–is taking hold,” said Ed Yardeni, president and chief investment strategist at Yardeni Research. “The market is treating the recent calamity as if it were a natural disaster rather than a severe recession.”
U.S. markets kicked off June with blistering gains, with the Dow up 3.49% over the first three trading days of the month. The S&P 500, meanwhile, posted Wednesday its longest winning streak since February.
The Nasdaq 100 index, which tracks the 100-largest nonfinancial companies in the Nasdaq Composite, stands 0.3% below a record set on Feb. 19. The index has rallied more than 43% from an intraday low set on March 23. The Nasdaq Composite, meanwhile, is just 1.58% below its all-time high.
“May could well end up being the turning point for the viral crisis. The month ended with the virus seemingly under control and with the economy reopening faster than expected,” wrote Brad McMillan, chief investment officer at Commonwealth Financial Network. “June will tell us whether that trend continues. But right now? Things look much better than we could have expected a month ago.”
Thursday’s forthcoming update to the U.S. unemployment claims threatened to keep the week’s optimism in check.
The Department of Labor is scheduled to release the latest update to initial jobless claims at 8:30 a.m. ET Thursday morning. Though economists polled by Dow Jones expect the government to announce yet another deceleration in the pace of claims, the consensus estimate predicts another 1.8 million Americans filed for insurance during the week ended May 30.
Last week, the Labor Department reported another 2.1 million Americans had filed claims in the week ended May 23.
—CNBC’s Gina Francolla contributed reporting.
Subscribe to CNBC PRO for exclusive insights and analysis, and live business day programming from around the world.
Futures tied to the major U.S. indexes were lower in early trading Thursday on the heels of yet another robust day on Wall Street.