MW: U.S. stock futures climb as employment data takes focus
By Steve Goldstein, MarketWatch
Fixed story to reflect release date of ADP report is Thursday.
LONDON (MarketWatch) -- U.S. stock futures rose Wednesday as employment data captures the spotlight two days ahead of the government's key report, with the release of jobs-related statistics from Challenger.
S&P 500 futures rose 6.2 points to 1,075.50 and Nasdaq 100 futures rose 13.5 points to 1,844.50. Futures on the Dow Jones Industrial Average added 50 points.
In a choppy session, U.S. stocks closed lower Tuesday, with the Dow Jones Industrial Average retreating 112 points and other major benchmarks lower as energy companies were hit by the failure of BP's top-kill operation to stem the Gulf of Mexico oil spill. U.S.-listed BP shares lost 15%, or about $20 billion in market capitalization. Continued jitters over European bank health and Chinese growth offset better-than-anticipated manufacturing data from the U.S.
Wednesday's focus begins to moves to employment data, with the Challenger layoffs report. ADP's estimate on private-sector employment is due Thursday, and the government's nonfarm payrolls report is due on Friday.
"The Challenger jobs report, as a 'soft' sentiment signal ahead of tomorrow's ADP and Friday's all-important nonfarms payrolls data, will be read as an indicator of the economy's ability to create jobs and the sustainability of housing demand further ahead," said Lena Komileva, head of G7 market economics at Tullett Prebon.
Also for Wednesday, April pending-home sales will be released.
Markets also will be assessing the resignation of Japanese Prime Minister Yukio Hatoyama after just nine months in office. The Nikkei 225 closed 1.1% lower in Tokyo, and the dollar rose against the Japanese yen (CUR_USDYEN 91.8400, +0.8600, +0.9453%) .
Paul Donovan, an economist at UBS, pointed out that markets are used to Japanese political turbulence -- Hatoyama's previous three predecessors only lasted 12 months each.
Societe Generale's news flow indicator -- which assesses the relative positive and negative economic news in press articles -- is indicating continued growth in the U.S. and Japan, stable news out of Europe, and slowing news momentum in China and India.
"We stick to our call of favoring U.S. and Japanese markets," they advised.
Car sales for May also will be released, bringing Ford Motor (F 11.41, -0.32, -2.73%) and Toyota Motor (TM 71.52, -0.82, -1.13%) into the spotlight. Even though the number is expected to show a minor improvement from April levels, incentives have dropped sharply, according to Edmunds.com data.
The Stoxx Europe 600 slipped 0.6% in late morning trade, and oil futures also slipped.
