MW: U.S. stock futures turn higher shortly before open
U.S. stock futures turned higher shortly before the opening bell Thursday as oil prices continued to climb following a deal reached by the OPEC producers to cut production.
Market’s immediate reaction to a jump in jobless claims was muted. The number of Americans applying for unemployment benefits over the week ended Nov. 26 jumped 17,000 to 268,000. The layoff level is still close to multidecade lows, however.
Along with the report on private-sector hiring released on Wednesday, showing 216,000 jobs added last month, investors expect a solid monthly job gains due Friday.
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As December trading was set to get under way, futures for the Dow Jones Industrial Average YMZ6, +0.17% were up by 32 points, or 0.2%, to 19,164. Futures for the S&P 500 index ESZ6, +0.15% were up by 2 points, or 0.1% to 2,201. Futures for the Nasdaq-100 index NQZ6, +0.04% was flat at 4,817.
The moves come after a choppy session on Wednesday, when stocks opened with firm gains after news the Organization of the Petroleum Exporting Countries agreed to cut output for the first time in eight years.
OPEC’s deal continued to support gains for oil prices Thursday, although prices briefly dipped ahead of the open. Brent crude LCOG7, +2.85% was up 1%, above $52 a barrel, and West Texas Intermediate oil futures CLF7, +2.89% picked up 1.2% to trade just above $50 a barrel. The contracts soared more than 9% on Wednesday.
Read: These oil stocks are soaring after OPEC’s cut—and more gains are on the way
The Energy Select Sector SPDR ETF XLE, +1.71% rose 0.6% premarket as oil prices rose. That ETF, the most popular way for investors to play the energy space, on Wednesday leapt 5.1%, its biggest one-day move since November 2011.
Even as energy stocks powered higher Wednesday, stronger advances for U.S. equities fizzled, leaving the Dow industrials DJIA, +0.01% to close marginally higher and the S&P 500 index SPX, -0.27% and Nasdaq Composite COMP, -1.05% ending in negative territory.
“Given the step change we’ve now seen in oil prices, this has the potential to deliver a meaningful impact to manufacturing costs, inflation and may also prove unsettling for consumers as North America moves into the depths of winter,” said Jamieson Blake, retail sales manager at ADS Securities London, in a note.
A return to data: Traders are likely to turn at least part of their attention to economics on Thursday.
“Today’s price action, as we start the final month of what has been a turbulent year, will return to the mundane matters of economic fundamentals with the latest manufacturing PMI numbers for November from Japan, China, Europe, the U.K. and the U.S.,” said Michael Hewson, chief market analyst at CMC Markets, in a note.
Earlier Thursday, official manufacturing purchasing managers index out of China came in better than expected, rising to 51.7 in November from 51.2 in October.
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U.S. manufacturing PMIs for November are due at 9:45 a.m. Eastern Time, followed by the ISM manufacturing reading at 10 a.m.
Construction spending for October is slated for release at 10 a.m., while monthly auto sales will trickle out through the morning.
