U.S. Stocks May Lack Direction Following Yesterday's Rally

Following the rally seen over the course of the previous session, stocks may show a lack of direction in early trading on Thursday. The major index futures are currently pointing to a roughly flat ope...

RTT Staff Writer•Thursday, June 6, 2024•2 min read

Following the rally seen over the course of the previous session, stocks may show a lack of direction in early trading on Thursday. The major index futures are currently pointing to a roughly flat open for the markets, with the S&P 500 futures down by less than a tenth of a percent.

Traders may take a step back to assess the outlook for the markets following yesterday’s surge, which lifted the Nasdaq and the S&P 500 to new record closing highs.

Trepidation ahead of Friday’s closely watched monthly jobs report may also keep some traders on the sidelines, as the data could have a significant impact on the outlook for interest rates.

The Labor Department report is expected to show employment increased by 185,000 jobs in May after climbing by 175,000 jobs in April, while the unemployment rate is expected to remain at 3.9 percent.

A day ahead of the release of the monthly jobs report, the Labor Department released a report this morning showing first-time claims for U.S. unemployment benefits rose by more than expected in the week ended June 1st.

The Labor Department said initial jobless claims climbed to 229,000, an increase of 8,000 from the previous week’s revised level of 221,000.

Economists had expected jobless claims to inch up to 220,000 from the 219,000 originally reported for the previous week.

Stocks moved sharply higher over the course of the trading day on Wednesday, adding to the modest gains posted during Tuesday’s session. With the rally on the day, the Nasdaq and the S&P 500 reached new record closing highs.

The Nasdaq and the S&P 500 saw further upside going into the close, reaching new highs for the session. The Nasdaq surged 330.86 points or 2.0 percent to 17,187.90 and the S&P 500 jumped 62.69 points or 1.2 percent to 5,354.03, while the narrower Dow posted a more modest gain, rising 96.04 points or 0.3 percent to 38,807.33.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan’s Nikkei 225 Index climbed by 0.6 percent, while Hong Kong’s Hang Seng Index rose by 0.3 percent.

The major European markets have also moved to the upside on the day. While the German DAX Index is up by 0.5 percent, the U.K.’s FTSE 100 Index is up by 0.4 percent and the French CAC 40 Index is up by 0.3 percent.

In commodities trading, crude oil futures are rising $0.61 to $74.68 a barrel after climbing $0.82 to $74.07 a barrel on Wednesday. Meanwhile, after jumping $28.10 to $2,375.50 an ounce in the previous session, gold futures are inching up $1.90 to $2,377.40 an ounce.

On the currency front, the U.S. dollar is trading at 156.14 yen versus the 156.11 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.0884 compared to yesterday’s $1.0869.