Published October 18, 2012
FOX Business: Capitalism Lives Here
U.S. stock-index futures fell solidly Thursday as traders responded to disappointing jobs data, mixed earnings and awaited more economic reports and headlines from Europe.
As of 9:08 a.m. ET, Dow Jones Industrial Average futures fell 16 points to 13472, S&P 500 futures dipped 5.3 points to 1452 and Nasdaq 100 futures slumped 13.3 points to 2758.
In the past three sessions, the S&P 500 has tacked on 2.3% in its biggest rally in more than a month. The gains have been fueled by generally upbeat corporate earnings and economic data.
Traders had several corporate reports to parse through on the day. Morgan Stanley (MS) and Travlers (TRV) both posted third-quarter results that topped analysts' expectations ahead of the opening bell. Meanwhile, Verizon Communications (VZ) matched Wall Street's forecasts. eBay (EBAY) weighed in after the close on Wednesday, with profits that beat and revenues that came in slightly shy, while American Express' (AXP) results came in close to expectations on the top and bottom lines.
The Labor Department reported weekly jobless claims rose to 388,000 last week from 342,000. Economists expected claims to rise to 365,000 from an initially-reported 339,000. The four-week average of claims, which helps smooth volatility, rose to 365,500 from 364,750. An analyst from Labor told FOX Business' Peter Barnes that an adjustment by "one large state" and seasonal factors has contributed to the swings. The analyst declined to identify the state, but economists believe it could be California.
"Claims at this level are absolutely not indicative of a labor market improving but rather treading water in an economy doing the same," Dan Greenhaus, chief global strategist at BTIG wrote in a note to clients. Ellen Zentner, an analyst at Nomura, struck a slightly more upbeat tone, writing in a note to clients that the data "suggest the level of layoffs remains low."
A closely-watched report from the Philadelphia Federal Reserve due later in the morning is expected to show manufacturing in the mid-Atlantic region expanded modestly this month after contracting the month before.
Analysts were also paying close attention to a European Council meeting that begins Thursday and ends on Friday. The group is expected to focus on economic integration among the 17 members of the eurozone, creating a single bank supervisor and probably the situation in Spain and Greece.
In commodities, oil prices fell modestly. The benchmark crude oil contract traded in New York fell 15 cents, or 0.17%, to $91.96 a barrel. Wholesale New York Harbor gasoline sold off by 1.3% to $2.745 a share.
The Euro Stoxx 50 fell 0.21% to 2564, the English FTSE 100 dipped 0.17% to 5901, and the German DAX rose 0.28% to 3104.
In Asia, the Japanese Nikkei 225 rallied 2% to 8983 and the Chinese Hang Seng climbed 0.48% to 21519.