Market Snapshot: Dow futures head lower ahead of key employment report as Senate approves historic $2 trillion coronavirus relief bill

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U.S. stock-index futures were edging lower Thursday morning, following the historic passage of a $2 trillion economic stimulus bill that was approved in the Senate late Wednesday, putting it one step closer to being signed into law to combat the coronavirus epidemic.

However, investors were awaiting the weekly jobless claims report from the Labor Department which is expected to see a huge spike in unemployment benefit claims and provide the clearest indication to date of the economic implications of the outbreak of COVID-19.

How are benchmarks performing?

Futures for the Dow Jones Industrial Average YMM20, -1.56% were down 77 points, or 0.4%, at 20,949, those for the S&P 500 ESM20, -1.79% were off by 18 points at 2,449, for a decline of 0.8%. Nasdaq-100 futures NQM20, -1.49% were trading 49 points, or 0.7%, lower at 7,418.75.

On Wednesday, the Dow DJIA, +2.39% rose 495.64 points, or 2.4%, to settle at 21,200.55. The S&P 500 SPX, +1.15%  rose 28.23 points, or 1.2%, to end at 2,475.56. The Nasdaq Composite COMP, -0.45% turned negative, finishing down 33.56 points, or 0.5%, at 7,384.30.

The move for the Dow on Wednesday marked its first two days of successive gains since Feb. 6, while the S&P 500 registered its first consecutive gains since the period ended Feb. 12.

From its recent record highs, the Dow is down 28.3% from its Feb. 12 closing peak, the S&P 500 was around 27% from its recent high, and the technology-heavy Nasdaq was off 25%.

What’s driving the market?

All eyes on Wall Street are on jobless claims figures, as investors watch for the effect of closures and statewide shutdowns of businesses intended to limit the spread of the deadly illness that was first identified in Wuhan, China in December and has infected 480,000 people globally and claimed more than 21,000 lives, according to data compiled by Johns Hopkins University.

In the U.S., nearly 70,000 people have contracted the illness while 1,046 have died.

The number of people who applied in mid-March for unemployment benefits, known as jobless claims, is forecast to zoom to a record 2.5 million from 281,000 in the prior week, according to economists polled by MarketWatch. The period covers March 15 to March 21 and will be published by the U.S. Labor Department on Thursday,

INvestors took some comfort late Wednesday from a $2 trillion emergency relief package approved by the U.S. Senate which is intended to help to mitigate the economic damage that the illness has already wrought on the U.S. economy. The House is expected to vote on the passage of the piece of legislation on Friday and President Donald Trump could sign into law by Saturday.

However, the jobless data expected to be published at 0.30 a.m ET could shake the tepid foundations of a market attempting to rebound from the abyss, market participants said.

“Stocks are lower this morning as traders are bracing themselves for the US jobless claims report,” wrote David Madden, market analyst at CMC Markets UK, in a daily research note.

In addition to the jobless claims claims, the market also will watch for a second reading of U.S. gross domestic product also due at 8:30 a.m., with a report on international trade in goods set to be released at the same time.

At 4 p.m. a report on the Federal Reserve’s balance sheet also will be released and may get more-than-average attention after the central bank unleashed an array of bond-buying measures intended to help give a boost to market hit by the pandemic.

How did other markets trade?

In bond markets, the yield on the 10-year U.S. Treasury note TMUBMUSD10Y, -8.34%  fell 2.6 basis points to 0.81%.

Crude oil rose, with the price of a barrel of West Texas Intermediate crude CL.1, -2.94%  traded down 68 cents, or 2.7%, at $23.82 a barrel on the New York Mercantile Exchange after rising 2% on Wednesday. In precious metals, April gold GCJ20, +0.40%  edged $3.30, or 0.2%, lower to $1,630.10 an ounce after slumping 1.7% a day ago.

The Stoxx Europe 600 SXXP, -1.71%  were trading 1.5% lower.

In Asia overnight on Thursday, stocks ended mostly lower, with the China CSI 300 000300, -0.66%  sliding 0.7%, Hong Kong’s Hang Seng Index HSI, -0.74%  retreated 0.7% and Japan’s Nikkei 225 NIK, -4.51%  tumbled 4.5% after two straight days of gains of at least 7%.

The U.S. dollar traded lower on Thursday, compared with a basket of its major peers. The ICE U.S. dollar index DXY, -0.88%  was down 0.8% after skidding 1.1% lower on Wednesday.

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