OPENING CALL
Stock futures and treasury yields rose early on Thursday, as investors returned from holiday and eyed the latest update on the health of the jobs market.
If there is continued upward momentum in jobless claims , it could prompt the Federal Reserve to reassess its timetable for interest rate cuts.
Meanwhile, it is central-bank day in Europe.
The Swiss National Bank caught traders off guard by cutting interest rates. In Norway, where inflation is running above target, Norges Bank kept borrowing costs on hold.
The Bank of England is expected to hold at 7 a.m. ET, after data showed prices for services are still galloping faster than officials would like.
Overseas Markets
Overseas markets were mixed, with gains in Europe and Japan but declines in Hong Kong and mainland China.
Premarket Movers
A merger inquiry into Hewlett Packard Enterprise's acquisition of Juniper Networks has been opened by Britain's competition regulator. HPE shares were up 2.3%.
KB Home's second-quarter earnings beat analysts' estimates and home orders in the period rose 2% to 3,997. The stock was rising 2%.
Nvdia rose more than 3%, which rubbed off on other semiconductor companies, including Micron, which rose more than 2% before the bell.
Trump Media & Technology Group fell 8.6%, extending sharp losses from Tuesday, after the company said the SEC had signed off on its registration statement and on the resale of shares and warrants.
Watch For:
Housing Starts for May; Weekly Jobless Claims; EIA Weekly Petroleum Status Report; speeches by Fed's Thomas Barkin, Mary Daly; Earnings from Accenture, Kroger, Darden Restaurants
Today's Top Headlines/Must Reads:
- For Apple's AI Push, China Is a Missing Piece
- Dell's AI Margin Slip Will Be a Speed Bump
- Bitcoin Price Slips as ETF Outflows Continue
MARKET WRAPS
Forex:
The Swiss franc turned lower against the euro after the SNB cut its key interest rate by 25 basis points to 1.25%.
The SNB will continue to monitor inflation developments closely and adjust policy if necessary, the central bank said as it cut its inflation forecasts for 2024-26.
Bonds:
Ten-year Treasury yields are expected to be stable in the coming quarters at higher levels than they are currently, while 10-year German Bund yields are expected to ease slightly, Barclays Research's updated global yield forecasts showed.
Ten-year Treasury yields are expected to trade at 4.50% in the third and fourth quarters of 2024 and in the first and second quarters of 2025.
The 10-year German Bund yield, meanwhile, is expected to decline to 2.35% by 2Q 2025 from 2.50% in 3Q 2024.
Energy:
Oil prices were broadly steady after a low-volume trading session on Wednesday due to a U.S. holiday, as expectations of a tighter market balance over the summer and persistent geopolitical risks continue to support sentiment.
Traders await official data from the Energy Information Administration on U.S. inventories for insights into the pace of the top consumer's demand.
Phillip Nova said oil prices are in a tug of war between supply and demand risks.
Oil prices are caught between geopolitical risks from the Gaza crisis, which could dent oil supplies from the key oil-producing regions on one hand, and concerns over the increase in U.S. oil inventories on the other, it said.
Metals:
Gold futures rose, finding tentative support from a gauge of U.S. retail sales in May pointing to greater financial strain among consumers, as such increasing the likelihood of an interest rate cut, MUFG said.
A slew of Fed officials have recently emphasized the need for more evidence of cooling inflation before lowering rates, MUFG added.
Separately, almost 60% of developed markets' central banks believe that gold's share of global reserves will rise in the next five years, according to an annual survey conducted by the World Gold Council, adding further support, it said.
Saxo Bank said gold's long-term outlook remains bullish despite the recent volatility.
The recent setback to gold prices was mainly due to the pause in bullion purchase by the People's Bank of China in May. That said, the analyst believes retail demand for gold in China will remain strong amid the country's property sector downturn and struggling economy.
Copper is likely to face more downside than upside risks over the next year, StoneX Intelligence said.
Copper prices are at an elevated level and aren't justified by current fundamentals, with China's economic recovery still facing huge hurdles and geopolitical tensions weighing on demand, and as the Chinese property sector still faces structural issues, it added.
TODAY'S TOP HEADLINES
Danone Targets Health, Nutrition as Food Industry Braces for Ozempic Era
Danone plans to double down on health and nutrition in the coming years as food companies seek to tackle the effects of Ozempic and other blockbuster weight-loss drugs on eating habits.
Two years into its turnaround plan, the company behind Activia yogurt and Evian water is pivoting toward acquisitions from an initial phase in which it offloaded assets it saw as underperforming. Its efforts come at a time consumers in many places around the world are ditching big brands in favor of private-label products after years of inflation.
Elon Musk Pitches Advertisers on a Return to X, Months After Telling Some to 'F' Themselves
Seven months after declaring that advertisers pulling their ads from his social-media platform X could "go f- yourself," Elon Musk took a more congenial tone onstage at the advertising industry's most important annual festival.
Musk joined Mark Read, chief executive of ad giant WPP, in a session Wednesday at the Cannes Lions International Festival of Creativity in France, a five-day event that draws thousands of the industry's chief marketing officers, tech leaders, creative workers and others from around the world.
U.K. Regulator to Scrutinize Hewlett Packard Enterprise-Juniper Networks Merger
The U.K.'s top antitrust watchdog will assess whether a merger between Hewlett Packard Enterprise and Juniper Networks undercuts competition.
The Competition and Markets Authority will probe the potential merger, in which the Texas-based IT firm, known as HPE, aims to buy California-based artificial intelligence and networking company Juniper in a deal that was valued at $14 billion in January.
It's Going to Cost More to Stay Cool This Summer
Summer is off to a sizzling start, which means higher electricity bills are on their way.
The Energy Information Administration expects the U.S. average monthly residential power bill to rise to $173 in June, July and August, up 3% from last summer.
Bank of Canada 'Considered the Merits' of Keeping Rate Unchanged in June: Minutes
OTTAWA-Bank of Canada policymakers considered keeping their main interest rate unchanged in June and wait for two months of inflation data, but in the end agreed the consumer-price index was on a sustainable path toward their 2% target, according to a summary of their deliberations leading up to a June rate cut.
Two weeks ago, the Bank of Canada became the first Group of Seven central bank to reduce its policy interest rate by a quarter-point, to 4.75%, and said further reductions were possible should inflation continue to decelerate. The central bank sets interest rates to achieve and maintain 2% inflation.
Louisiana Requires Ten Commandments to Be Displayed in Public-School Classrooms
Louisiana will now require public schools to display the Ten Commandments, reigniting the debate over where such displays are permissible.
The state's Republican governor, Jeff Landry, signed a bill into law Wednesday mandating that every public-school class post the display no later than January. The Ten Commandments are a set of moral instructions in the Bible telling people to not kill, steal or lie, among other directives.
Bob Menendez's Lonely Effort to Keep His Senate Seat
WEST NEW YORK, N.J.-Bob Menendez, in a long-shot campaign to hang on to his Senate seat while under federal indictment, recently breezed through the bar of a cherry-paneled Spanish restaurant here.
The New Jersey Democrat, who has been in office since 2006, and his wife personally asked patrons at Meson Español for signatures to help him get a spot on the November ballot as an independent candidate, according to people familiar with the matter.
Russia Says It Is Awaiting U.S. Response on Prisoner Swap
Russia said it is awaiting a response from Washington to its proposals for a possible exchange of prisoners, an apparent reference to U.S. citizens detained in Russia such as Wall Street Journal reporter Evan Gershkovich.
Russia's deputy foreign minister, Sergei Ryabkov, Wednesday told the state news agency TASS that "the ball is in the U.S.'s court, we are waiting for their response to the ideas that were presented to them."
Write to ina.kreutz@wsj.com TODAY IN CANADA
Earnings:
Algoma Steel 4Q
Aurora Cannabis 4Q
Empire 4Q
Economic Calendar [ET]:
0830 May New Housing Price Index
0830 Apr Employment Insurance
Stocks to Watch:
WestJet: Aircraft Mechanics Fraternal Association Has Rescinded Its Strike Notice; WestJet, AMFA Agree to Return to Bargaining Table to Continue Work Towards Finding Resolution; CIRB Invites Further Submissions on Necessity of Arbitration
Expected Major Events for Thursday
05:00/JPN: May Convenience Store Sales
06:00/GER: May PPI
08:30/GER: Ifo Economic Forecast
10:00/UK: May Aluminium Production report
11:00/UK: Agents' Summary of Business Conditions
11:00/UK: UK interest rate decision
12:30/US: Jun Philadelphia Fed Business Outlook Survey
12:30/US: May New Residential Construction - Housing Starts and Building Permits
12:30/CAN: May New Housing Price Index
12:30/CAN: Apr Employment Insurance
12:30/US: 1Q International Transactions
(MORE TO FOLLOW) Dow Jones Newswires
06-20-24 0626ET
