US STOCKS-Wall St to rebound at open as debt ceiling, inflation worries cool
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* High growth stocks lead the gains; energy stocks are falling
* Fall in weekly jobless claims in the United States; layoffs increase in seven.
* Futures up: Dow 0.89%, S&P 0.93%, Nasdaq 1.10% (adds comments, bullets, updates prices throughout)
By Shreyashi Sanyal
Oct. 7 (Reuters) – U.S. stocks were expected to open higher on Thursday after a temporary deadlock on the debt ceiling in Congress allayed fears of a possible public debt default, while ‘A drop in oil prices has allayed fears of higher inflation.
Senior U.S. Senate Republican Mitch McConnell on Wednesday launched a plan to support an extension of the federal debt ceiling through December, potentially avoiding a historic default. Democrats and Republicans in Congress were scheduled to continue negotiations on Thursday.
“I didn’t think there would actually be a default, it’s a low probability, high severity possibility. And since this has been taken off the market, I’m not surprised to see this rebound in futures. “said Greg Swenson. , founding partner of Brigg Macadam.
High growth stocks were back – Apple Inc, Amazon.com Inc, Microsoft Corp and Alphabet Inc rose 1.0% to 1.2% amid falling benchmark 10-year US Treasury yield on Thursday .
“I am not worried about the short term markets and it is advisable to buy bears,” Swenson said.
European and Asian stocks rose earlier in the day after cooling oil and gas prices relieved investors worried about soaring inflation. US energy stocks, including Exxon Mobil Corp, Marathon Petroleum Corp and APA Corp, led declines with declines between 0.2% and 0.5%.
Data showed that the number of Americans filing new jobless claims declined last week, but layoffs rose from a 24-year low in September.
The ADP national employment report released on Wednesday showed private payrolls increased by 568,000 jobs last month. Economists polled by Reuters predicted an increase of 428,000 jobs
This precedes the more comprehensive data on nonfarm wages expected on Friday. This should strengthen the case for slowing asset purchases by the Fed.
As of 8:40 a.m. ET, Dow e-minis were up 305 points, or 0.89%, S&P 500 e-minis were up 40.5 points, or 0.93%, and e-minis Nasdaq 100 were up 162.5 points, or 1.1%.
Levi Strauss & Co jumped 4.7% after the jeans maker topped third-quarter revenue and profit estimates, spurred by increased demand for jeans as people refreshed their wardrobes.
Snap Inc gained 2.1% after launching an in-app tool to educate users about the dangers of drugs.
Conagra Brands Inc rose 1.7%, beating quarterly revenue expectations after increasing the prices of its frozen meals and snacks. (Reporting by Shreyashi Sanyal and Devik Jain in Bengaluru; Editing by Saumyadeb Chakrabarty)