Analysts expect markets to remain calm despite the upcoming jobs report, which could show a steady decline in unemployment. With stocks continuing their uptrend and bond yields on the rise, investors are increasingly attracted by higher potential returns than savings accounts or CDs.
The “russell 2000 futures” is a stock index that measures the performance of futures contracts for the Russell 1000 Index. The “russell 2000 futures” has been up 2% in the past week, with consumer spending and jobless data being the main driving factors.
Stock futures and Treasury rates in the United States have risen in anticipation of new consumer spending and other economic data that will impact monetary policy next year.
The S&P 500 futures rose 0.2 percent on Thursday. Strong economic statistics helped soothe investors’ fears about the dangers presented by Covid-19 and inflation on Wednesday, as the index rose for a second day. The Nasdaq-100 index, which is centered on technology, was up 0.1 percent on Thursday, while the Dow Jones Industrial Average futures were up 0.2 percent.
Novavax’s stock rose 5.6 percent in premarket trading after the company claimed its two-dose Covid-19 vaccine produced “strong immune responses” against Omicron and other strains.
At 8:30 a.m. ET, the Commerce Department will issue new data on consumer spending and a key gauge of inflation, the personal-consumption expenditures price index. Core inflation, which excludes typically volatile food and energy costs, climbed at the quickest annual rate in almost four decades in November, according to economists. Job increases and growing earnings, high levels of family saving, and inflationary pressures undoubtedly supported consumer spending in November in the United States.
Investors are concerned that the Omicron version would increase inflationary pressures.
REUTERS/ANDREW KELLY/PHOTO
The Federal Reserve accelerated the phasing down of its pandemic-era stimulus after strong inflation statistics earlier in December. Investors and central bankers are concerned that the Omicron version would increase inflationary pressures.
“For a lot of people, inflation is front and center,” said Andrew Cole, Pictet Asset Management’s head of multiasset in London. “Inflation is largely predicted to peak in the first half of next year, if not in the first quarter. Central banks may have to wait till the second part of next year to relax.”
Higher inflation and low government bond rates have deterred some investors from holding them this year, resulting in lower returns on holding them to maturity. The 10-year Treasury note yield rose to 1.474 percent on Thursday, up from 1.457 percent the day before. When prices fall, yields climb.
At 8:30 a.m., new jobless claims statistics will be released. As firms struggle to cling on to employees, economists predict first-time applications for unemployment benefits, a proxy for layoffs, to stay extraordinarily low in the week ending Dec. 18.
Overseas, the Stoxx Europe 600 index increased by 0.5%. Asia’s major stock indexes ended the day higher, with China’s Shanghai Composite up 0.6 percent and South Korea’s Kospi up 0.5 percent, respectively. The Nikkei 225 index in Japan gained 0.8 percent.
JD.com’s stock dropped 7% in Hong Kong trade after Chinese social media behemoth Tencent Holdings said it was selling the majority of its investment in the online retailer. Tencent’s stock increased by 4.2 percent. The Hang Seng Index in Hong Kong increased by 0.4 percent.
Caitlin Ostroff can be reached at caitlin.ostroff@wsj.com.
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The “u.s. stock market open” is a headline that the U.S. stock futures were up ahead of consumer spending and jobless data from this morning’s report.
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