US pre-open: Stocks to rise but gains seen more muted
US futures pointed to a mostly positive session on Wall Street on Thursday following a rally the day before, although gains were expected to be much more muted.
At 1245 BST, Dow Jones Industrial Average and S&P 500 futures were up 0.3% and 0.1%, respectively, while Nasdaq futures were flat. On Wednesday, stocks ended in the black, with gains in the technology sector pushing the Nasdaq to a record close.
London Capital Group analyst Jasper Lawler said: "Banking and tech stocks sealed another rally on Wall Street overnight, with the Dow surging over 25,000 for the first time since March and the Nasdaq hitting another record high - the third in a row.
"Tech stocks managed to put in another impressive performance despite Brussels preparing to slap a fine on Google parent Alphabet, for abusing its dominance through the Android operating system. Whilst traded volume in Alphabet was over 7 times greater than Tuesday, the share price showed impressive resistance falling just 0.2%. Clearly investors aren’t overly concerned about the most significant regulatory move against Google’s business model."
Financial stocks gained as bond yields rose following suggestions on Wednesday from European Central Bank officials that they are prepared to reveal more about plans for exiting the quantitative easing programme next week.
In currency markets, the dollar was down versus both the pound and the euro. The single currency was extending its European Central Bank-inspired rally overnight after policymaker Peter Praet said the central bank will need to assess at next week’s meeting whether to unwind the quantitative easing programme.
Lawler said this "as good as confirmed earlier reports that the ECB were willing to discuss what has been the elephant in the room for most of this year".
In corporate news, discount retailer Five Below was sharply higher in pre-market trade after its quarterly earnings late on Wednesday beat analysts’ expectations.
Elsewhere, furniture retailer Conn’s surged in pre-market trade after better-than-expected first-quarter earnings, but JM Smucker was firmly in the red after its fourth-quarter adjusted earnings fell short of expectations.
AmTrust Financial Services was set to rack up solid gains at the open after after Evergreen Parent LP raised its bid to buy the shares that the Karfunkel-Zyskind family doesn’t already own or control to $14.75 a share from $13.50.
Biogen was likely to be in focus after saying it has entered an exclusive option agreement with TMS Co. to acquire its TMS-007 treatment for acute stroke.
On the data front, initial jobless claims at 1330 BST are expected to show a 225,000 gain versus 221,000 the week before.