With traders weighing upbeat bank earnings against a disappointing jobs report, 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.
Better than expected earnings from Bank of America (BAC) and Morgan Stanley (MS) helped to drive the futures higher earlier in the day along with news of another successful Spanish bond auction.
While Bank of America reported first quarter earnings of $0.03 per share compared to $0.17 per share a year ago, the results included an accounting charge of $0.28 per share. Excluding the charge, the company earned $0.31 per share versus analyst estimates for $0.12 per share.
Morgan Stanley reported a first quarter net loss of $0.06 per share but reported a profit of $0.71 per share excluding a big accounting charge. Analysts had expected the company to earn $0.44 per share.
However, the positive sentiment was offset by the release of a report from the Labor Department showing initial jobless claims well above economist estimates in the week ended April 14th.
Jobless claims edged down to 386,000 from the previous week's revised figure of 388,000 but still came in well above economist estimates of 365,000.
"Discouraging news on initial jobless claims suggest job growth is slowing," said Jennifer Lee, senior economist at BMO Capital Markets. "Still growing, mind you, but at a slower pace."
A slew of additional economic data is scheduled to be released a half-hour after the start of trading, including closely watched reports on existing home sales and Philadelphia-area manufacturing activity.
While existing home sales are expected to edge up to an annual rate of 4.62 million in March, the index of activity in the Philadelphia-area manufacturing sector is expected to dip to a reading of 12.0 in April.
The Conference Board is also expected to release a report on its leading economic indicators index, which is expected to rise by 0.2 percent in March.
Stocks moved moderately lower over the course of the trading day on Wednesday, giving back some ground after ending the previous session sharply higher. While the markets showed a negative bias throughout the session, selling pressure was somewhat subdued.
The major averages saw some volatility in late-day trading but all finished the day in the red. The Dow fell 82.79 points or 0.6 percent to 13,032.75, the Nasdaq dipped 11.37 points or 0.4 percent to 3,031.45 and the S&P 500 slid 5.64 points or 0.4 percent to 1,385.14.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Thursday. While Japan's Nikkei 225 Index ended the day down by 0.8 percent, Hong Kong's Hang Seng Index closed up by 1 percent.
The major European markets have also turned mixed over the course of the trading day. The U.K.'s FTSE 100 Index is up by 0.3 percent, while the German DAX Index is down by 0.6 percent and the French CAC 40 Index is down by 0.8 percent.
In commodities trading, crude oil futures are receding $0.27 to $102.40 a barrel after falling $1.53 to $102.67 a barrel on Wednesday. Gold futures, which dropped $11.50 to $1,639.60 an ounce in the previous session, are sliding $4.80 to $1,634.80 an ounce.
On the currency front, the U.S. dollar is trading at 81.54 yen compared to the 81. 26 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.3083 versus the euro compared to yesterday's $1.3123.
by RTT Staff Writer
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