Nasdaq, S&P Futures Point To Caution Ahead Of Jobless Claims, GDP Data — Micron Leads Chip Sector Lower, China Stocks Rally

Trading in the index futures points to a modestly lower opening on Wall Street on Thursday even as traders optimistically wait for the Santa Claus rally to kick in.

Wednesday, the U.S. stock rally accelerated, as traders shrugged off another negative housing market data and instead chose to focus on positive earnings. Existing home sales fell 7.7% month-over-month and plunged 35.4% from a year ago in November, and the number fell back to levels that prevailed in 2010 when the housing market experienced a deep correction. On the other hand, a separate report showed consumer confidence climbing to its best level since April.

The major averages opened higher and rose until late morning trading — before beginning to move sideways in a consolidation move.

The session witnessed broad-based strength, will all sectors closing in the green. Consumer discretionary, consumer staple, energy, financial, material and technology stocks led from the front in Wednesday’s rally.

Making sense of Wednesday’s upside, Jamie Cox, managing partner at Harris Financial said, “Markets are too pessimistic and not paying attention to what’s actually happening in the economy. Earnings are dropping as expected, but not to the extremes markets are pricing.”

“So, when you get better numbers, these fast snap backs happen.”

Here’s a peek into index futures trading:

In premarket trading on Thursday, the SPDR S&P 500 ETF Trust SPY slipped 0.03% to $386.11 and the Invesco QQQ Trust QQQ edged down 0.05% to $273.30, according to Benzinga Pro data.

On the economic front, the Labor Department will release the customary weekly jobless claims report at 8:30 a.m. EST. Economists, on average, expect the number of individuals claiming unemployment benefits to increase from the previous week’s 211,000 to 222,000 in the week that ended Dec. 17.

The Bureau of Economic Analysis is due to release its final third-quarter GDP data around the same time. The consensus expectation is for a reaffirmation of the quarterly growth at 2.9%. The price consumption expenditure reading of the report assumes importance because of its implication for inflation.

The Chicago Federal Reserve’s national activity index for November is expected to be released at 8:30 a.m.

The Conference Board is scheduled to release its U.S. leading index for November at 10 a.m. EST. The pace of the month-over-month drop in the index may have slowed from -0.8% in October to -0.4% in November.

The Kansas City Federal Reserve’s composite index for November is due at 11 a.m. EST.

The Treasury is due to auction 4-week and 8-week bills at 11:30 a.m. EST.

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Stocks In Focus:

• Memory chipmaker Micron Technology, Inc. MU declined over 2.5% in premarket trading in reaction to its quarterly earnings miss. Other chip stocks, including Applied Materials, Inc. AMAT, ASML Holdings N.V. ASML, were pulling back in sympathy.
• Chinese e-commerce companies Alibaba Group Holding Limited BABA and JD.com, Inc. JD moved solidly higher.
• Shares of Mirati Therapeutics, Inc. MRTX, which recently received an FDA nod for its KRAS inhibitor to treat lung cancer, rose about 6.75% after the drug regulator granted breakthrough designation for the same in colorectal cancer.
• Chinese e-commerce companies Alibaba Group Holding Limited BABA, JD.com, Inc. JD and Pinduoduo, Inc. PDD moved solidly higher.
• Apogee Enterprises, Inc. APOG, CarMax, Inc. KMX and Paychex, Inc. PAYX are among the notable companies reporting quarterly results before the market open.

Commodities, Other Global Markets:

Crude oil futures climbed for the fourth straight session and traded up 1.62% to $79.58.

The yield on the benchmark U.S. 10-year Treasury slipped back by 0.039% to 3.645%.

Among equity markets, Asia-Pacific stocks advanced strongly on Thursday, capitalizing on the positive lead from Wall Street overnight. Chinese stocks bucked the uptrend amid renewed COVID-19 outbreak in Shanghai. The Indian market also ended the session lower.

The European markets opened higher and experienced volatility in early trading, Giving back early gains, France’s CAC 40 Index and the German DAX Index were languishing in the red, while U.K.’s FTSE 100 Index was holding up amid the release of revised third quarter GDP data showing a steeper than initially forecast contraction.

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