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Stock futures mixed as economic data rolls in

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U.S. stock futures struggled for direction Thursday morning as investors pored over a batch of economic data.

Futures tied to the benchmark S&P 500 slip 0.1%, while futures on the Dow Jones Industrial Average hovered ticked up by the same margin. Contracts on the technology-heavy Nasdaq Composite fell 0.3%. The moves come after a modest rebound on Wednesday from the stock market’s worst day since June 2020.

Initial jobless claims fell for a fifth-straight week to the lowest reading since May. Filings for first-time unemployment insurance totaled 213,000 in the week ended Sept. 10 from 222,000 in the prior week, the Labor Department said Thursday. Economists called for 227,000 claims, according to consensus estimates compiled by Bloomberg.

On the bond side, the benchmark U.S. 10-year Treasury note climbed above 3.45%, and the 2-year Treasury teetered past 3.8% after hitting a 15-year high on the heels of shock August inflation data earlier this week.

Last month’s Consumer Price Index (CPI) showed prices rose a more-than-expected 8.3% over last year, triggering a meltdown across U.S. equity markets as investors faced the reality that more combative central bank policy will be necessary to tame inflation.

Economists at Bank of America said Wednesday in a note that Federal Reserve officials are likely to warn market participants that risks of a hard landing are rising following their policy-setting meeting next week.

“This will likely come through projections that show less growth, higher unemployment, and a more restrictive policy rate stance,” BofA strategists led by Michael Gapen said. “While the Fed is still likely to view a soft landing as a modal outcome, the window appears to be narrowing.”

Market information is reflected in the glasses of trader as they work on the trading floor at the New York Stock Exchange (NYSE) in Manhattan, New York City, U.S., September 13, 2022. REUTERS/Andrew Kelly

The CME FedWatch Tool Thursday morning showed markets were pricing in a nearly 30% chance the Federal Reserve will raise interest rates by a full percentage point next week as inflation shows signs of becoming entrenched in the U.S. economy.

Cryptocurrency markets were front and center Thursday after Ethereum completed its highly-anticipated “merge.” a technological shift to a more energy-efficient method of how tokens are minted. Ethereum USD (ETH-USD) traded just under $1,600 Thursday morning, while Bitcoine (BTC-USD) held above $21,000.

Meanwhile, oil prices slipped, continuing a volatile stretch for energy markets. West Texas Intermediate (WTI) crude oil fell 1.6% to $87.06 per barrel, erasing Wednesday’s gain, while Brent crude oil futures dipped 1.5% to $92.67 per barrel.

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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