ADP private-sector payrolls, services index on deck
U.S. stock futures fell Thursday, with the recent tech rally showing signs of faltering, as investors waited for a raft of economic data that might give a framework for the Federal Reserve's thinking.
Dow Jones Industrial Average futures dropped 87 points, or 0.4%, to 21,333.00, and S&P 500 futures gave up 11.50 points, or 0.5%, to 2,416.50. Nasdaq-100 futures fell 58 points, or 1%, to 5,594.00.
The drop in Nasdaq futures indicates the previous day's rally in technology stocks (http://www.marketwatch.com/story/us-stock-futures-flutter-as-focus-turns-to-fed-jobs-report-2017-07-05) may lose steam. A 1% gain for tech shares helped the S&P 500 close 0.2% higher Wednesday, as the tech-heavy Nasdaq Composite Index finished with a 0.7% rise. The Dow Jones Industrial Average ended fractionally lower, down less than 0.1%.
"There are a lot of things keeping risk appetite in check. Geopolitical worries are beginning to bear down," on Wall Street and in Europe , where losses in regional benchmarks on Thursday accelerated, said Chris Beauchamp, senior market analyst at IG in London.
"The rotation out of techs started and [investors] moved into financials. You've also got a broader move out of equities back to bonds to provide a safe haven, to some degree," as investors increasingly key in on risks including escalating tensions surrounding North Korea's test-launch this week of an intercontinental ballistic missile, he said.
U.S. President Donald Trump said Thursday in Warsaw he's considering "some pretty severe things" in response to North Korea's (http://www.marketwatch.com/story/trump-considering-pretty-severe-things-over-north-korea-threat-2017-07-06) ongoing efforts to develop nuclear weapons that can reach the U.S.
Read:U.S., Russia clash at U.N. over approach to North Korea threat (http://www.marketwatch.com/story/us-russia-clash-at-un-over-approach-to-north-korea-threat-2017-07-06)
"You've got a busy [Thursday] in terms of data ... for ADP, ISM, and EIA [oil data], and then nonfarm payrolls tomorrow. So there's a there's a lot that needs to be factored in in terms of the economic calendar, which was a bit distorted with Independence Day," said Beauchamp.
"The market is not getting too panicky just yet, but you're into that July, August, September period where we could see a bit of a grind," he added.
Economic docket: The market will look to an update on private sector job growth on Thursday as a bellwether for Friday's marquee jobs report from the Labor Department. The Federal Reserve closely watches labor-market conditions as part of its monetary policy assessment, and the report comes as investors continue to unpick the Fed minutes released Wednesday.
Those minutes left many uncertain as to policy makers' strategy for reducing the Fed's $4.5 billion in debt holdings (http://www.marketwatch.com/story/fed-might-start-balance-sheet-drawdown-in-september-fomc-minutes-hint-2017-07-05), which has acted as support for the U.S. economy.
ADP will release its report on private-sector jobs report for June at 8:15 a.m. Eastern Time. Economists polled by FactSet are looking for 183,000 jobs added, compared with 253,000 in May.
An update on weekly jobless claims is scheduled to arrive at 8:30 a.m. Eastern, with a reading of 248,000 expected. Due at the same time, a report on the trade deficit for May is expected to show a narrowing to $46.3 billion.
A snapshot of activity in the services sector in June will come from Markit at 9:45 a.m. Eastern. Then at 10 a.m. Eastern, the ISM's services index will be released.
As for Fed speakers, Gov. Jerome Powell will talk about at housing finance reform at the American Enterprise Institute in Washington, D.C. at 10 a.m. Eastern. Later, Vice Chairman Stanley Fischer will speak about government policy and labor productivity at 7:30 p.m. Eastern, at Martha's Vineyard Hebrew Center Summer Institute in Vineyard Haven, Mass.
See: MarketWatch's economic calendar (http://www.marketwatch.com/economy-politics/calendars/economic).
Stocks in focus:General Electric Co. shares (GE) fell 1.3% premarket after the European Union's antitrust watchdog (http://www.marketwatch.com/story/ge-canon-merck-kgaa-accused-of-antitrust-moves-2017-07-06) said GE may have misled regulators when the EU was reviewing its $1.65 billion deal with LM Wind Power.
Tesla Inc.(TSLA) fell 2.5% before the bell after the electric car maker's Model S failed to receive a top safety award (http://www.marketwatch.com/story/teslas-stock-drops-after-model-s-fails-to-qualify-for-top-safety-award-2017-07-06) from the Insurance Institute for Highway Safety. Its shares tumbled on Wednesday (http://www.marketwatch.com/story/teslas-stock-tumbles-into-correction-territory-but-analysts-sees-new-highs-ahead-2017-07-05) after a disappointing sales-delivery update.
L Brands Inc.(LB) shares fell 4.2% in light volume ahead of the bell as Victoria's Secret's parent company posted a 6% drop in June sales (http://www.marketwatch.com/story/victorias-secret-parent-l-brands-shares-fall-after-june-sales-decline-2017-07-06).
Shares of Costco Wholesale Corp.(COST) rose 2.7% ahead of the bell after the retailer reported better-than-expected sales numbers for June.
Other markets: The ICE Dollar Index , which measures the buck against a basket of six currencies, was down 0.3% at 96.04. Gold gained modestly to trade above $1,225 an ounce. Oil futures jumped more than 1% (http://www.marketwatch.com/story/oil-bounces-back-after-worst-loss-in-a-month-ahead-of-eia-data-2017-07-06).
Stock markets in Asia finished mostly lower, with the Nikkei Stock Average losing 0.4%.
(END) Dow Jones Newswires
July 06, 2017 07:53 ET (11:53 GMT)