- High-growth stocks lead gains; energy stocks fall
- U.S. weekly jobless claims fall; layoffs rise in Sept.
- Futures up: Dow 0.89%, S&P 0.93%, Nasdaq 1.10%
Oct 7 (Reuters) – U.S. stocks were set to open higher on Thursday after a temporary truce in the debt-ceiling standoff in Congress relieved concerns of a possible government debt default, while a dip in oil prices eased worries of higher inflation.
Top U.S. Senate Republican Mitch McConnell on Wednesday floated a plan to support an extension of the federal debt ceiling into December, potentially heading off a historic default. Congressional Democrats and Republicans were expected to continue negotiating on Thursday. read more
“I didn’t think there is actually going to be a default, it is a low probability, high severity possibility. And since that’s been removed from the market, I’m not surprised to see this bounce in futures,” said Greg Swenson, founding partner of Brigg Macadam.
High-growth stocks were back in action – Apple Inc (AAPL.O), Amazon.com Inc (AMZN.O), Microsoft Corp (MSFT.O) and Alphabet Inc (GOOGL.O)rose between 1.0% and 1.2% amid a dip in the benchmark U.S. 10-year Treasury yield on Thursday.
“I’m not worried about the markets in the near term and buying dips is advisable,” Swenson said.
European and Asian stocks rose earlier in the day after cooling oil and gas prices offered relief to investors worried about runaway inflation. U.S. energy stocks including Exxon Mobil Corp (XOM.N), Marathon Petroleum Corp (MPC.N) and APA Corp (APA.O) led declines with falls between 0.2% and 0.5%.
Data showed the number of Americans filing new claims for jobless benefits fell last week, but layoffs increased from a 24-year low in September. read more
The ADP National Employment Report on Wednesday showed private payrolls increased by 568,000 jobs last month. Economists polled by Reuters had forecast a rise of 428,000 jobs
This comes ahead of the more comprehensive non-farm payrolls data due on Friday. It is expected to cement the case for the Fed’s slowing of asset purchases.
At 8:40 a.m. ET, Dow e-minis were up 305 points, or 0.89%, S&P 500 e-minis were up 40.5 points, or 0.93%, and Nasdaq 100 e-minis were up 162.5 points, or 1.1%.
Snap Inc gained 2.1% after launching an in-app tool to educate users about the dangers of drugs. read more
Reporting by Shreyashi Sanyal and Devik Jain in Bengaluru; Editing by Saumyadeb Chakrabarty
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