U.S. stock futures rose early Thursday to kick off a new month and quarter as investors hoped for more fiscal stimulus to combat the coronavirus recession.
Dow futures jumped 210 points, or 0.7%, indicating an opening gain of about 220 points. S&P 500 futures rose 0.8%. Nasdaq 100 futures gained 1.3%.
The House of Representatives delayed a vote on the Democrats $2.2 trillion rescue package on Wednesday evening to allow for more talks, which some saw as a sign progress could be made.
White House chief of staff Mark Meadows told reporters late Wednesday that President Donald Trump has extended an offer for more than $1.5 trillion in stimulus. No further details were given on the exact figure except that anything around $2 trillion and above would be a “real problem.”
House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin failed to strike a coronavirus aid deal in a meeting Wednesday afternoon, however the pair said the conversation would continue.
“We have always maintained a glimmer of hope – especially as we continue to believe there is majority support for a package in the $1.5-2 trillion range,” wrote Ed Mills of Raymond James. “However, all of our conversations with our DC contacts remain skeptical.”
A broad group of stocks were gaining in premarket trading Thursday. Delta and United led airline shares higher in early trading on stimulus hopes. Key tech like Amazon, Apple and Tesla also rose in premarket trading.
Sentiment was also lifted by better-than-expected weekly jobless claims report. The Labor Department said first-time filers for unemployment benefits came in at 837,000 in the week ending Sept.26. Economists polled by Dow Jones expected a total of 850,000.
The major averages were coming off their first down month since March. The Dow Jones Industrial Average lost 2.2% in September, a typically weak month for equities. The S&P 500 fell 3.9% for the month, while the technology-heavy Nasdaq Composite dropped 5.2%.
However, all three benchmarks achieved strong gains for the third quarter. The S&P 500 rose 8.5% in the quarter for its sixth positive quarter in seven and the index is up 4% for the year.
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The first trading day of the fourth and final quarter of 2020 occurs on Thursday.