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James Hyerczyk
US Stocks Indexes

U.S. stock index futures are trading higher in the overnight session early Thursday after the blue chip Dow Jones Industrial Average closed at a record level during normal trading hours on Wednesday.

At 06:10 GMT, futures tied to the benchmark S&P 500 Index gained 7.25 or 0.18%. The technology-driven NASDAQ 100 futures advanced 23.25 or 0.18% and the Dow futures contract is up 78 or +0.24%.

The early strength marks an extension of yesterday’s rally that saw the Dow jump 425 points to close at a record high in a volatile session that at one-point saw the 30-stock average drop more than 110 points. The S&P 500 advanced 1.1%, while the NASDAQ Composite gained 1%. Earlier in the tech-heavy index was down 1.3%.

Powell Fuels Rally by Calming Inflation Worries

Shares on Wall Street rallied on Wednesday, with the Dow hitting a record high, as a selloff in technology-related stocks eased and a rotation into cyclical shares continued after Federal Reserve Chair Jerome Powell’s comments calmed inflation worries.

Powell told lawmakers on Wednesday it may take more than three years to reach the central bank’s inflation goals, a sign the Fed plans to look beyond any post-pandemic spike in prices and leave interest rates unchanged for a long time to come.

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Value Stocks in Higher Demand

Value-oriented stocks have enjoyed a bit of a bounce recently, with the S&P 500 Value Index rising for a fourth straight day.

The S&P 500 financial sector jumped 2.1% after earlier hitting an all-time peak, while other cyclical stocks including industrials, energy and materials also rose.

The S&P 500 Growth Index, housing most of the high-flying technology-related stocks, has come under pressure in the last few days due to valuation concerns, elevated Treasury yields and an investment shift into more economy-sensitive parts of the market.

Growth-oriented stocks are particularly sensitive to rising yields as their value rests heavily on future earnings, which are discounted more deeply when bond returns go up.

Busy Day on Thursday

On the data front, initial jobless claims numbers will be released at 13:30 GMT on Thursday, with economists surveyed by Dow Jones expecting a print of 845,000. Also at 13:30 GMT, the U.S. Department of Commerce will release its second estimate for fourth-quarter GDP.

On the earnings front, a number of companies are set to release quarterly results. Best Buy, Papa John’s and Domino’s Pizza are among the names on deck before the opening bell. After the market closes, Salesforce.com, Beyond Meat, Etsy and Caesars Entertainment are among the names reporting.

Newly public companies Airbnb and DoorDash are also slated to report earnings on Thursday after the closing bell.

For a look at all of today’s economic events, check out our economic calendar.

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