By Chris Matthews, MarketWatch
Jobless claims fall
The major U.S. stock benchmarks edged higher at the start of
trade Thursday, as investors continue to digest headlines
surrounding the potential for a U.S.-China trade deal.
How are the benchmarks trading?
The Dow Jones Industrial Average rose 131 points, or 0.5%, to
24,656 while the S&P 500 index rose 16 points, or 0.6% to
2,666. The Nasdaq Composite Index advanced 52 points, or 0.7% to
7,151.
Read:S&P 500 lows? We ain't seen nothing yet, says Gundlach
(http://www.marketwatch.com/story/sp-500-lows-we-aint-seen-nothing-yet-says-gundlach-2018-12-12)
What's driving the market?
U.S.-China trade concerns remain at fore of investor minds
Thursday, as they continue to digest headlines from earlier in the
week that suggested the Chinese were ready to make significant
concessions to their industrial policy and reduce tariffs on
imported autos, while President Trump indicated he would intervene
in the arrest of Huawei's chief financial officer Meng Wanzhou if
it would help ensure a trade deal with China.
Read:Trump aides warn against intervening in Huawei case
(http://www.marketwatch.com/story/trump-aides-warn-against-intervening-in-huawei-case-2018-12-13)
On Thursday, reports that China has stopped requiring local
governments
(https://www.scmp.com/economy/china-economy/article/2177856/beijing-no-longer-requires-local-governments-work-made-china)
to work toward its "Made in China 2025" strategy have added support
to the thesis that China is willing to slow its push to strengthen
its high-tech industry at the expense of foreign rival firms.
Traders are also focused on Thursday's jobless claims data,
which showed a significant decline in the number of Americans newly
applying for unemployment benefits. The statistic, which is a
leading indicator for labor markets and the economy, had been
rising in recent months, albeit from historic lows.
Investors are also beginning to consider the tail risks
associated with special counsel Robert Mueller's investigation of
the Trump administration. S&P 500 futures dipped Wednesday
evening, after reports
(https://www.politico.com/story/2018/12/12/national-enquirers-deal-imperil-trump-1061792)
that the National Enquirer's parent company, privately held
American Media Inc. had agreed to tell prosecutors everything it
knows about President Trump.
What data are in focus?
The Labor Department announced Thursday morning
(http://www.marketwatch.com/story/jobless-claims-sink-27000-to-206000-erase-thanksgiving-surge-that-now-seems-a-mirage-2018-12-13)
that initial jobless claims fell in the week ended Dec. 8 by 27,000
to 206,000, easing fears that layoffs have been steadily
rising.
The government also announced
(http://www.marketwatch.com/story/us-import-prices-fall-16-in-november-biggest-drop-in-3-years-2018-12-13)
that U.S. import prices fell 1.6% in November, their largest
decline in three years, led by the falling cost of oil.
What are the analysts saying?
Jobless claims were "much lower than expected following
high-side surprises in the previous weeks," Jim O'Sullivan, chief
U.S. economist at High Frequency Economics wrote in a note to
clients. "This report should lessen fears that the labor market is
weakening significantly."
What stocks are in focus?
Shares of General Electric Co. (GE) are in focus Thursday, after
the firm announced it would launch
(http://www.marketwatch.com/story/ge-shares-surge-9-premarket-on-news-of-new-iot-business-jpmorgan-upgrade-2018-12-13)
a $1.2 billion industrial "internet-of-things" company, and after
JP Morgan separately upgraded the stock from underweight to
neutral. The stock is up more than 10% at the start of trade
Thursday
Aflac Inc. (AFL) stock is up 4.7% Thursday, after the insurer
confirmed it is in talks with Japan Post Holdings Co. Ltd. to take
a minority stake.
Shares of Delta Air Lines Inc. (DAL) are trading down 5.7%
Thursday, after the firm announced 2019 earnings guidance of
between $6 and $7 per share, versus the consensus of $6.70, per
FactSet.
Coca-Cola Corp. (KO) stock is the Dow's biggest loser at the
start of trade Thursday, down 0.5% after the company was downgraded
to neutral from buy by UBS.
Monster Beverage Corp. (MNST) stock is down 2.4% early Thursday,
following UBS' initiation of coverage of the company, with a sell
rating.
How did the benchmarks fare yesterday?
On Wednesday, The Dow Jones Industrial Average rose 157.03
points, or 0.6%, to end at 24,527.27, while the S&P 500 index
advanced 14.29 points, or 0.5%, to 2,651.07. The Nasdaq Composite
Index climbed 66.48 points, or 1%, to 7,098.31.
(http://www.marketwatch.com/story/asia-stocks-rally-into-a-second-day-with-hong-kong-markets-in-the-lead-2018-12-12)
How are other markets trading?
Stock markets in Asia rose broadly Thursday
(http://www.marketwatch.com/story/asia-stocks-rally-into-a-second-day-with-hong-kong-markets-in-the-lead-2018-12-12),
with Hong Kong's Hang Seng Index , Japan's Nikkei , and the
Shanghai Composite Index all ending the day higher.
In Europe, stocks are mixed as investors digest news of the end
of the European Central Bank's bond buying program, and as
uncertainty around Brexit continues to weigh on sentiment. The
Stoxx Europe 600 was trading flat, while the FTSE 100 was down
0.2%.
Crude oil prices are falling Thursday, while Gold was down 0.2%
and the U.S. dollar was virtually unchanged.
(END) Dow Jones Newswires
December 13, 2018 09:55 ET (14:55 GMT)
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