Before the Bell - A trio of reports are being issued before the stock market opens this morning that could well have an impact on trading during today’s session. Two, in fact, already have been released. And they were very encouraging. Specifically, the Labor Department reported that first-time jobless claims fell to 576,000 in the latest week, a post-pandemic low and well below the expected 710,000. That compares with 769,000 filings in the previous seven-day stretch. With this strong metric in hand, the equity futures are pointing to a sharply higher opening this morning.
In the other pivotal and very upbeat report just released, the Commerce Department noted that retail sales rose by 9.8% in March. That was better than the 6.1% consensus increase forecast. Helping the latest month's performance were solid gains in demand for clothing--up 18%. Stimulus payments helped there.. This report, along with earlier metrics on job growth and manufacturing activity suggest that first-quarter GDP growth likely jumped well past the mid-single-digit area seen in earlier forecasts. Finally, data on industrial production will be out just before the market opens today.
Meanwhile, in news issued yesterday, the Federal Reserve released its Beige Book summary of business conditions across the country, a document used by the central bank to assist it in formulating monetary policy at the next FOMC meeting, scheduled for late this month. In that report, the principal Fed District banks said that economic activity had accelerated to a moderate pace from late February to early April. The Fed Districts also noted a pickup in job creation during that period.
In addition to these reports, we are seeing the start of earnings reporting season, with several big banks already issuing their results for the first quarter. Here, financial giant JPMorgan Chase (JPM) led the way with a blowout issuance. That Dow component eased, however, in dealing yesterday. Also doing well on the bottom-line in the opening period was Goldman Sachs (GS). That strong showing helped this issue to a nice gain. Finally, ailing banking behemoth Wells Fargo (WFC) posted better results, with that stock gaining as well.
Looking ahead, additional financial corporations and then some tech companies will report their results in the coming days. As for the overall stock market, it posted a mixed to lower close yesterday, with the Dow Jones Industrial Average holding on to a narrow 53-point advance after an earlier gain of better than 200 points. The S&P 500, up for most of the day, eased back to a closing loss, while the NASDAQ, buffeted by selling in the tech space, shed 138 points. Here, Tesla (TSLA), a big winner on Tuesday, fell 30 points, As noted, though, the bulls are seemingly ready to charge ahead at the open. – Harvey S. Katz, CFA