Dow Futures Rise 190 Pts Ahead of ADP Jobs Data

This post was originally published on this site – U.S. stocks are set to open higher Wednesday, continuing the record-breaking positive momentum, with investors buoyed by strong economic data and a stream of encouraging comments from Federal Reserve officials.

At 7:10 AM ET (1110 GMT), S&P 500 Futures traded 22 points, or 0.7%, higher, the Dow Futures contract rose 190 points, or 0.7%, and Nasdaq 100 Futures climbed 120 points, or 1%. 

The Dow Jones Industrial Average closed 0.8% higher Tuesday, while the S&P 500 index gained 0.8% and the NASDAQ Composite index climbed 1.4%, both recording new all-time closing highs.

Stocks have soared as investors reacted with optimism to last week’s announcement from the Federal Reserve that the central bank will change its strategy, effectively giving it an easier policy bias for the foreseeable future.. 

Fed Governor Lael Brainard added to this optimism late Tuesday, saying the central bank would need to provide more stimulus to fulfill its promise of stronger job growth and higher inflation.

Additionally, U.S. Treasury Secretary Steven Mnuchin spoke Tuesday with House Speaker Nancy Pelosi about stalled coronavirus aid negotiations. Although these talks didn’t result in anything concrete, it may be a good sign that the two sides are communicating again now the presidential conventions are over. 

Economic data have also been reasonably strong of late, with Tuesday showing U.S. manufacturing expanding in July at the fastest pace since 2018.

Wednesday sees the ADP Research Institute’s August jobs report, due at 8:15 AM ET (1215 GMT), ahead of Thursday’s weekly jobless claims and Friday’s official U.S. monthly employment report. The ADP report is expected to show gains of 950,000 non-farm private sector jobs, a hefty jump from 167,000 in July.

This will be followed by factory orders data for July at 10 AM and the Federal Reserve’s Beige Book survey of the U.S. economy at 2 PM.

In corporate news, Macy’s (NYSE:M) reported a loss per share of 81 cents, better than expected, on sales of $3.56 billion. Shares of the department store giant are down almost 60% in 2020. 

Specialty discount store Five Below (NASDAQ:FIVE) is set to publish earnings per share of 14 cents on sales of $411.92 million. Shares have fallen 12% this year.

Oil prices posted gains Wednesday, boosted by a larger-than-expected drop in U.S. stockpiles. 

The American Petroleum Institute reported late Tuesday that crude inventories fell by 6.4 million barrels last week to about 501.2 million barrels, when analysts had expected a draw of 1.9 million barrels.

Investors will now look to the Energy Information Administration’s release later in the session to see if it paints a similar picture.

U.S. crude futures traded 0.6% higher at $43.00 a barrel, while the international benchmark Brent contract rose 0.6% to $45.85. 

Elsewhere, gold futures fell 0.4% to $1,971.90/oz. EUR/USD traded 0.4% lower at 1.1864.

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