Economic news

Wall St Set to Slip at Open on Gloomy Jobless Claims Data

Feb 18 (Reuters) - Wall Street’s main indexes were set to open lower on Thursday as investors resumed a shift out of big technology firms, while an unexpected rise in weekly jobless claims underscored a fragile labor market recovery.

The Labor Department’s report showed initial claims for state unemployment benefits were 861,000 last week, compared with 848,000 in the prior week.

“The one part of the economy that has remained disappointing is clearly the employment picture,” said Ryan Detrick, chief market strategist at LPL Financial in Charlotte, North Carolina.

U.S. stock indexes hit record highs at the beginning of the week but gradually retreated following a rise in treasury bond yields, which led to fears of higher inflation.

Those concerns have spurred investors to book profit on stocks with high valuation in the S&P 500 technology and communications services sectors, which have underpinned a 76% rise in the benchmark index since its March 2020 lows.

Shares of Apple Inc, Microsoft Corp, Inc, and Alphabet Inc were down between 0.7% and 2.3% in premarket trading.

“A steady slow increase may not necessarily disrupt the uptrend in equities but will likely force rotation from highly priced stocks, typically in the tech sector, to more reasonably priced cyclical ones,” said Hussein Sayed, chief market strategist at FXTM.

Facebook Inc shares slipped around 1% on Thursday as Wall Street assessed the wider ramifications of its move to block all news content in Australia.

Walmart Inc slid 5% after the world’s largest retailer missed quarterly profit estimates and predicted fiscal 2022 net sales to rise in low single digits.

At 8:40 a.m. ET, Dow e-minis were down 171 points, or 0.54%, S&P 500 e-minis were down 24.5 points, or 0.62%, and Nasdaq 100 e-minis were down 126.25 points, or 0.92%.

Marriott International Inc dipped 0.5% after reporting a quarterly loss as the world’s largest hotel chain’s bookings declined due to pandemic-induced travel restrictions.

Reporting by Devik Jain and Shreyashi Sanyal in Bengaluru; Editing by Saumyadeb Chakrabarty and Anil D’Silva

Source: Reuters

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