The Market News Today: U.S. Stock Futures Rise Ahead of Weekly Initial Claims

U.S. Stock Futures Edge Up Amid Rate Hike Concerns and Strong Job Data

U.S. stock futures are showing modest gains during Thursday’s pre-market session despite the Dow’s three-day loss, as investors weigh Fed Chair Powell’s remarks on needing more evidence of inflation control before rate cuts. The Fed’s cautious stance, echoed by Atlanta Fed President Bostic, dampens expectations for rate reductions, with CME FedWatch showing a decreased likelihood of a cut in June. Strong ADP employment data fuels concerns of prolonged high rates, while experts anticipate a broader market rally beyond tech stocks. Upcoming economic reports on jobless claims and trade deficit are in focus, with the nonfarm payrolls report due Friday.

10-Year Treasury Yield Rises Amid Fed Speeches and Upcoming Economic Data

The 10-year Treasury yield climbed slightly on Thursday, reaching 4.361%, as investors anticipate Federal Reserve officials’ speeches and key economic data. The yield had briefly hit a yearly high of 4.429% the previous day. Fed Chair Powell’s recent comments suggest a cautious approach to rate cuts, impacting market expectations. Investors await the U.S. jobs report and initial jobless claims, with Fed speeches also scheduled. Current expectations lean towards rates holding steady in May, with a reduced probability of a June cut.

Gold Hits Record Highs on Rate Cut Expectations and Weak Currency

Gold prices soared to a record $2,304.09 per ounce early Thursday, driven by expectations of Federal Reserve interest rate cuts in 2024 and global currency depreciation. U.S. gold futures also rose by 0.2% to $2,318.70. Despite Fed Chair Powell emphasizing the need for more data before rate cuts, anticipated in June, the slowing U.S. services industry growth supports a softer inflation outlook. The upcoming U.S. jobs report and inflation data remain critical factors influencing gold’s trajectory and the likelihood of rate reductions.

Oil Prices Stable Amid Supply Concerns and U.S. Economic Growth

Oil prices remained steady as supply cuts by major producers and signs of robust U.S. economic growth influenced the market. Brent futures slightly dropped to $89.30 a barrel, while U.S. WTI futures edged down to $85.42 a barrel. The OPEC+ meeting’s decision to maintain output policy and address oversupply issues has reassured markets, despite geopolitical tensions in the Middle East and ongoing conflict in Eastern Europe. Federal Reserve Chair Powell’s cautious stance on rate cuts also signals continued strong U.S. economic performance, impacting oil demand.

US Natural Gas Futures Dip Ahead of EIA Storage Report

US Natural Gas futures are seeing a slight decline as the market anticipates the US Energy Information Administration’s storage report, expected to show a withdrawal between -38 and -43 Bcf. Recent cooler weather across most of the US, excluding some regions, has driven stronger demand, while a forthcoming spring storm in the Great Lakes and East is expected to maintain this trend. However, a shift to milder conditions next week across the US predicts a decrease in demand.