Initial weekly jobless claims fall by 5,000 to 348,000, data show
By Kate Gibson and Barbara Kollmeyer, MarketWatch
NEW YORK (MarketWatch) — U.S. stock futures remained lower Thursday as worries about the global economy overtook another positive report on the American labor market.
Stock-index futures held their losses after the government reported claims for unemployment benefits fell by 5,000 last week to 348,000, the lowest level in more than four years.
The data are “encouraging as we have a certain improvement in the labor market,” said Peter Boockvar, equity strategist at Miller Tabak, in an email.
The bearish sentiment, however, came with data on factories in China that revealed a sharp slowdown in activity. Futures for the Dow Jones Industrial Average DJM2 -0.53% fell 50 points, or 0.4%, to 13,016.
S&P 500 Index futures SPM2 -0.58% fell 6.7 points, or 0.5%, to 1,390.80, while Nasdaq 100 futures NDM2 -0.48% fell 11 points, or 0.4%, to 2,724.25.
“Equity markets seemingly remain in overbought territory, underlining the selloff we saw ahead of the close on Wall Street last night and futures markets are suggesting that this trend may be sustained for at least a little while yet,” said David Morrison, senior market strategist at GFT Markets.
U.S. stocks closed mostly lower on Wednesday, with Hewlett-Packard Co. HPQ -1.77% leading declines amid investor skepticism over the blue-chip technology company’s restructuring plan. The Dow Jones Industrial Average DJIA -0.73% dropped 45.57 points, or 0.4%, to 13,124.62.
“The Dow is certainly under pressure now and a break below 13,000 could well be seen as a significant cause for concern,” said Morrison.
China delivered fresh pressure for markets on Thursday. Commodities, European and Asian stocks fell following a preliminary reading of HSBC’s manufacturing purchasing managers' index for March that showed new orders at a four-month low, with the reading dropping to 48.1 from 49.6 in February. China factories slumping amid low demand
The data mark another China-related knock for markets after indications earlier in the week that the country’s demand for resources such as iron ore could be waning.
Data from Europe were equally gloomy: A Markit euro-zone purchasing managers' index showed the contraction of private-sector activity accelerated in March.
The region’s peripheral markets were also coming under the spotlight again, with yields higher for Spanish and Italian 10-year government bonds. The Stoxx Europe 600 index XX:SXXP -1.17% fell 1.1% to 265.7. Read more about selling in European stocks.
Leading indicators for February and Federal Housing Finance Agency home prices for January are due for release at 10 a.m. Eastern.
In other markets, crude-oil futures for May delivery CLK2 -2.17% dropped $1.03, or 1%, to $106.24 a barrel, while April gold GCJ2 -1.10% fell $13.00, or 0.8%, to $1,637.30 an ounce.
The ICE dollar index DXY +0.38% , which measures the greenback’s performance against a basket of six other currencies, rose to 79.819 from 79.654 in North American trade late Wednesday.
On the corporate front, shares of FedEx Corp. FDX -3.04% fell 1.4% in preopen trade. The company reported a third-quarter profit that beat Wall Street forecasts, though revenue narrowly fell short.
Shares of ConAgra Foods Inc. CAG -0.29% also fell marginally in preopen trading. It reported a 26% gain in third-quarter profit and a 7% gain in sales, but said conditions had been tough across the industry.
