U.S. Stocks May Come Under Pressure In Early Trading

wallstreet sept05 30jun22 lt

Following the lackluster performance seen in the previous session, stocks are likely to come under pressure in early trading on Thursday. The major index futures are currently pointing to a sharply lower open for the markets, with the S&P 500 futures down by 1.1 percent.

Lingering concerns about the global economic outlook are likely to weigh on the markets amid concerns about a possible recession.

Central bank chiefs have recently reaffirmed their resolve to bring down inflation despite threats to economic growth.

Healthcare stocks may help lead the way lower after Universal Health Services (UHS) lowered its full-year guidance, citing a significant shortfall in operating results experienced during April and May.

On the U.S. economic front, the Commerce Department released a report showing personal income increased in line with economist estimates in the month of May.

The report showed personal spending rose by 0.5 percent in May, matching the revised increase seen in April as well as expectations.

Meanwhile, the Commerce Department said personal spending edged up by 0.2 percent in May after climbing by a downwardly revised 0.6 percent in April.

Economists had expected personal spending to increase by 0.5 percent compared to the 0.9 percent advance originally reported for the previous month.

A reading on inflation said to be preferred by the Federal Reserve showed the annual rate of core consumer price growth slowed to 4.7 percent in May from 4.9 percent in April.

A separate report released by the Labor Department showed a modest decrease in first-time claims for U.S. unemployment benefits in the week ended June 25th.

The Labor Department said initial jobless claims slipped to 231,000, a decrease of 2,000 from the previous week's revised level of 233,000.

Economists had expected jobless claims to edge down to 228,000 from the 229,000 originally reported for the previous month.

Just after the start of trading, MNI Indicators is scheduled to release its report on Chicago-area business activity in the month of June. The Chicago business barometer is expected to dip to 58.0 in June from 60.3 in May, although a reading above 50 would still indicate growth.

Following the sell-off seen during trading on Tuesday, stocks showed a lack of direction over the course of the trading session on Wednesday. The major averages spent the day bouncing back and forth across the unchanged before closing narrowly mixed.

While the Dow rose 82.32 points or 0.3 percent to 31,029.31, the Nasdaq and S&P 500 ended the day slightly lower. The Nasdaq edged down 3.65 points or less than a tenth of a percent to 11,177.89, and the S&P 500 dipped 2.72 points or 0.1 percent to 3,818.83.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Thursday. Japan's Nikkei 225 Index slumped by 1.5 percent, while China's Shanghai Composite Index jumped by 1.1 percent.

Meanwhile, the major European markets have all moved sharply lower on the day. While the U.K.'s FTSE 100 Index has tumbled by 1.9 percent, the French CAC 40 Index and the German DAX Index are down by 2.3 percent and 2.4 percent, respectively.

In commodities trading, crude oil futures are falling $1.10 to $108.68 a barrel after slumping $1.98 to $109.78 a barrel a barrel on Wednesday. Meanwhile, after slipping $3.70 to $1,817.50 an ounce in the previous session, gold futures are sliding $11.80 to $1,805.70 an ounce.

On the currency front, the U.S. dollar is trading at 136.10 yen versus the 136.59 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.0395 compared to yesterday's $1.0442.

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