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U.S. Stocks May Lack Direction As Monthly Jobs Report Looms

wallstreet1 061318 01jul21 lt

With traders looking ahead to Friday's monthly 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, with the S&P 500 futures up by 6.50 points.

Traders may be reluctant to make significant moves ahead of the release of the Labor Department's report on the employment situation in the month of June.

Economists currently expect the report to show employment jumped by 690,000 jobs in June after surging up by 559,000 jobs in May. The unemployment rate is expected to dip to 5.7 percent from 5.8 percent.

A day ahead of the release of the monthly jobs report, the Labor Department released a report this morning showing first-time claims for U.S. unemployment benefits fell by more than expected in the week ended June 26th.

The report said initial jobless claims slid to 364,000, a decrease of 51,000 from the previous week's revised level of 415,000.

Economist had expected jobless claims to dip to 393,000 from the 411,000 originally reported for the previous week.

With the bigger than expected decrease, jobless claims fell to their lowest level since hitting 256,000 in the week ended March 14, 2020.

On Wednesday, payroll processor ADP released a report showing private sector employment jumped by 692,000 jobs in June after spiking by 886,000 jobs in May.

U.S. stocks closed broadly higher on Wednesday as optimism about a strong economic recovery outweighed concerns about inflation and the possibility of interest rate hikes happening next year.

Among the major averages, the Dow came back fairly strongly after suffering a setback in the previous session, the S&P 500 hit another record high and the Nasdaq edged down marginally.

The Dow ended up by 210.22 points or 0.6 percent at 34,502.51. The S&P 500 settled at 4,297.50, gaining 5.70 points or 0.1 percent, and the Nasdaq closed lower by 24.38 points or 0.2 percent at 14,503.95.

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Thursday. Japan's Nikkei 225 Index fell by 0.3 percent, while China's Shanghai Composite Index edged down by 0.1 percent.

Meanwhile, the major European markets have moved to the upside on the day. While the U.K.'s FTSE 100 Index has advanced by 0.9 percent, the French CAC 40 Index is up by 0.5 percent and the German DAX Index is up by 0.3 percent.

In commodities trading, crude oil futures are spiking $1.94 to $75.41 a barrel after climbing $0.49 to $73.47 a barrel on Wednesday. Meanwhile, after advancing $8 to $1,771.60 an ounce in the previous session, gold futures are rising $6.20 to $1,777.80 an ounce.

On the currency front, the U.S. dollar is trading at 111.44 yen versus the 111.11 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.1875 compared to yesterday's $1.1858.

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