Stock futures were flat on Thursday as Wall Street looked to build on its best day in nearly a month.
Dow Jones Industrial Average futures gained 13 points, or 0.03%. S&P 500 futures are down 0.11%, and Nasdaq 100 futures are down 0.20%.
Futures changed little after the European Central Bank raised interest rates by 0.75 percentage points, raising its deposits to 0.75% from 0%, in a largely expected move to curb inflation. Next, traders look forward to a question-and-answer session from Federal Reserve Chair Jerome Powell at the Cato Institute later in the day as they searched for more clues about the central bank’s plans for a future rate hike.
The stock market comes out of a Strong recovery during normal trading hours on Wednesday. The Dow was up 436 points, or 1.4%. The S&P 500 is up 1.8%, and the Nasdaq Composite is up 2.1%.
It was the best day since August 10 for all three averages, and the Nasdaq snapped a seven-day losing streak.
Even with Wednesday’s rally, stocks are still in a downtrend overall. Concerns about a slowing economy and an increase in interest rates from the Federal Reserve are driving some investors away from the riskier parts of the market.
“Recession risks are increasing as we move more defensively in our portfolios as a result. However, higher inflation means that traditional ‘risk-off’ strategies such as cash and government bonds can create a drag on total return,” Lauren Goodwin, economist and portfolio strategist at New York Life Investments, in a note to clients.
“We are fully invested in our portfolios, using selective bets within this generally neutral position to build resilience against volatility and inflation. In our equity envelope, this includes a significant increase in share value and dividend payers,” added Goodwin.
On Thursday morning, investors will get the latest look at the US economy with jobless claims data. Economists polled by Dow Jones expect 235,000 initial unemployment claims, up slightly from 232,000 the previous week.
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