Dow set to rise as investors brace for crush of earnings, economic data

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MARKET SNAPSHOT

U.S. stocks were poised to climb on Thursday as investors braced for a fresh round of earnings reports from major financial institutions and economic data, including a reading on retail sales and weekly jobless claims.

How are stock benchmarks trading?

  • Futures for the Dow Jones Industrial Average gained 153 points, or 0.5%, to reach 33,777.
  • S&P 500 index futures were trading 18.60 points to reach 4,136.50, a gain of 0.5%.
  • Nasdaq-100 futures advanced 74.25 points, or 0.6%, to 13,873.

On Wednesday, the Dow closed up 53.62 points or 0.2% to 33,730.89, the S&P 500 index finished 16.93 points or 0.4% lower at 4,124.66, while the Nasdaq Composite Index shed 138.26 points or 1% to close at 13, 857.84, off 1.7% from its Feb. 12 record high.

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What’s driving the market?

Wall Street is looking at another big day for earnings reports, economic data and speakers from the Federal Reserve that could help dictate momentum for the market.

So far the trend appears to be higher for equities, a day after Coinbase Global’s debut on the Nasdaq, marking a major milestone for the crypto industry.

See: Coinbase is most valuable U.S. exchange after first day of trading

On Thursday, investors were poring over a first-quarter report from Bank of America Corp. after it reported profit that more than doubled and beat expectations, citing strong growth in capital markets and lower credit costs. The bank also announced a $25 billion stock repurchase program. Bank of America is one of the most actively traded stocks in the U.S. market.

Investors will also parse results from PepsiCo  Citigroup  BlackRock  and Delta Air Lines a day after Goldman Sachs Group  and JPMorgan Chase  delivered good results, suggesting that the economic recovery from the COVID pandemic is indeed taking hold.

Beyond earnings, some strategist said that market participants may becoming more entrenched in the belief despite rising inflation the Federal Reserve will keep interest rates low and liquidity measures in place to continue to stimulate the COVID-stricken economy. Doubts about the Fed’s commitment had been driving up benchmark bond yields this year but lately yields have stabilized, with the 10-year Treasury note yielding a little over 1.60% on Thursday and trading within a range between 1.6 and 1.75% in recent weeks.

See: Strategist: Don’t be surprised to see double-digit retail sales growth

“While there’s a lot of excitement in equities, traders are also keeping an eye on the fixed income markets. US Treasuries are showing that investors are becoming more convinced by the Federal Reserve’s message that inflation spikes are only transitory and won’t lead to a tightening of policy anytime soon,” wrote Hussein Sayed, Chief Market Strategist at FXTM, in a note.

In a moderated discussion sponsored by the Economic Club of Washington, Federal Reserve boss Jerome Powell said the central bank would likely taper asset purchases “well before the time we consider raising interest rates,” riffing off the 2013-14 playbook.

“We haven’t voted on that order, but that is the sense of the guidance that it would work in that way,” Powell said.

On the public health front, a study by Oxford University found the number of people who receive blood clots after getting vaccinated with a coronavirus vaccine are about the same for those who get Pfizer PFE and Moderna MRNA vaccines as well as for the AstraZeneca AZN vaccine that was produced with the university’s help. The study comes after the Food and Drug Administration and the Centers for Disease Control and Prevention requested an immediate halt of Johnson & Johnson’s one-shot COVID vaccine.

Investors are also awaiting remarks from Fed speakers, including Atlanta Fed President Raphael Bostic Speaks at 11:30 a.m. Eastern, San Francisco Fed President Mary Daly at 2 p.m. and Cleveland Fed President Loretta Mester at 4 p.m.

In U.S. economic data, investors will look for the Labor Department’s latest report on the number of Americans filing first-time claims for unemployment insurance due at 8:30 a.m. Eastern Time. Economists polled by Dow Jones expect the government to report that another 710,000 filed claims for the first time during the week ended April 10. And a report on March retail sales, due at the same time, are expected to show a rise in consumer spending on the back of $1,400 COVID aid checks.

A reading of manufacturing activity in the Philadelphia area, the Philadelphia Manufacturing Index, also is due at 8:30 a.m., and will be closely watched. A separate report from the New York region, the Empire State Manufacturing Index, will be released at the same time.

A report on industrial production at 9 a.m., and separate reports on business inventories and a housing market index are set to come out at 10 a.m.

Which companies are in focus?

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