With concerns about the looming fiscal cliff overshadowing upbeat jobs data, stocks may move to the downside in early trading on Thursday. The major index futures are currently pointing to a modestly lower open for the markets, with the Dow futures down by 21 points.
Worries about whether lawmakers in Washington will be able to reach an agreement to avoid the fiscal cliff are likely to weigh on the markets.
Unless Congress takes action, approximately $600 billion in automatic tax increases and government spending cut are due to take effect at the end of the year.
Reports on Wednesday indicated that some rank-and-file Republicans might compromise on higher tax rates on the wealthy in exchange for entitlement reforms, but GOP leaders remain staunchly opposed to the increase in rates proposed by President Obama.
As a result of the focus on the fiscal cliff negotiations, traders have largely shrugged off a report from the Labor Department showing a bigger than expected drop by initial jobless claims in the week ended December 1st.
The Labor Department said jobless claims fell to 370,000, a decrease of 25,000 from the previous week's revised figure of 395,000. Economists had expected jobless claims to drop to 380,000 from the 393,000 originally reported for the previous week.
With the drop, jobless claims continued to settle down after seeing considerable volatility due to the impact of Superstorm Sandy.
Peter Boockvar, managing director at Miller Tabak, said, "Bottom line, claims of 370,000 put it back in line with the trend seen prior to Sandy, which point to a growing jobs market albeit at a lackluster pace due to issues we are all well aware of."
Overseas, the European Central Bank and the Bank of England both left monetary policy unchanged, as was widely expected.
ECB President Mario Draghi said the central bank continues to see downside risks to the economic outlook for the euro area and lowered the outlook for European GDP in 2012 and 2013.
Trading activity on the day may be somewhat subdued as traders look ahead to tomorrow's closely watched monthly jobs report from the Labor Department.
Stocks saw considerable volatility over the course of the trading day on Wednesday before eventually ending the session mixed. A focus on the latest developments in Washington contributed to big swings by the markets.
The major averages ended the day on opposite sides of the unchanged line, with the Nasdaq posting a notable loss. The Nasdaq fell 22.99 points or 0.8 percent to 2,973.70, while the Dow rose 82.71 points or 0.6 percent to 13,034.49 and the S&P 500 edged up 2.23 points or 0.2 percent to 1,409.28.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Thursday. While Japan's Nikkei 225 Index advanced by 0.8 percent, Hong Kong's Hang Seng Index edged down by 0.1 percent.
Meanwhile, the major European markets have all moved to the upside on the day. The German DAX Index has risen by 0.9 percent, while the U.K.'s FTSE 100 Index is up by 0.3 percent and the French CAC 40 Index is up by 0.1 percent.
In commodities trading, crude oil futures are sliding $0.52 to $87.36 a barrel after falling $0.62 to $87.88 a barrel on Wednesday. Gold futures, which dipped $2 to $1,693.80 an ounce in the previous session, are down $3.90 at $1,689.90 an ounce.
On the currency front, the U.S. dollar is trading at 82.35 yen compared to the 82.47 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.3027 compared to yesterday's $1.3067.
For comments and feedback contact: editorial@rttnews.com
Business News
May 01, 2026 15:54 ET Central banks dominated the economics news flow this week with almost all major ones announcing their latest policy decisions and many boosted expectations for a rate hike in June. In other news, several countries released the preliminary data for first quarter economic growth. In the U.S., comments by Fed Chair Jerome Powell were also in focus as his term ends this month.