By Saumya Vaishampayan and Tommy Stubbington
U.S. stock futures rose Wednesday, bolstered by a
better-than-expected reading on the U.S. jobs market.
Major indexes hit record highs on Tuesday, and the Dow Jones
Industrial Average came within striking distance of the 17,000
mark.
About an hour ahead of the open, Dow Jones Industrial Average
futures added 24 points, or 0.1%, to 16900.00.
S&P 500 index futures inched up 2.2 points, or 0.1%, to
1968.00 and Nasdaq-100 futures rose 4.00 points, or 0.1%, to
3889.25. Changes in stock futures don't always accurately predict
stock moves after the opening bell.
Stocks have been rising in the past several weeks as economic
data in the U.S. and elsewhere in the world showed signs of steady,
albeit slow, improvement. This week markets got a boost from China,
where readings on the manufacturing sector indicated expansion.
Worries about China and the U.S., which suffered a harsh winter,
prompted a sharp selloff early in the year.
The Dow on Tuesday minted its 12th closing record for the year,
ending 0.8% higher at 16956.07. During intraday trading on Tuesday,
the blue-chip index rose as high as 16998.70. Gains in the S&P
on Tuesday propelled the index to its 23rd record in 2014.
Investors' expectations that U.S. interest rates will stay low for
a long time--and bond yields at historically low levels--are also
contributing to the stock-market rally.
On Wednesday, Automatic Data Processing and Moody's Analytics
reported that employers in the U.S. added 281,000 jobs in June,
compared with expectations for an increase of 210,000 based on a
Dow Jones Newswires poll of economists. Factory orders in May are
expected to post a decline.
However, much of the market's attention will be focused on the
June nonfarm payrolls report, which will be released on Thursday, a
day earlier than usual due to the Fourth of July holiday in the
U.S.
"If the [ADP] data are confirmed by tomorrow's [nonfarm
payrolls] data, obviously the talk of monetary-policy changing
before market expectations would resurface," said Peter Cardillo,
chief market economist at Rockwell Global Capital. "That could be a
catalyst for a short-term pullback in the market."
Shares of J.P. Morgan Chase & Co. were down 0.6% in
premarket trading following the disclosure late Tuesday that Chief
Executive James Dimon was diagnosed with throat cancer.
The records in U.S. stocks lifted European shares, with the
Stoxx Europe 600 up 0.39%. European gains came despite a set of
euro-zone manufacturing indicators that showed a modest slowdown in
June.
With economic data still pointing to a fragile and uneven
recovery, European shares have lagged behind their U.S.
counterparts since the European Central Bank last month introduced
a package of easing measures including interest-rate cuts and cheap
loans to banks.
Shares of a number of French telecom firms came under pressure
after Orange SA said it has dropped plans for a potential merger or
acquisition in France. The firm has been at the heart of intense
merger speculation, notably tying it to smaller rival Bouygues
Telecom, a unit of Bouygues.
The yield on the 10-year Treasury note was down 1 basis point to
2.551%.
In commodities markets, Brent crude oil was down 0.4% at $104.90
a barrel, while gold inched up 0.1% to $1,327.80 an ounce.