U.S. Stocks May See Initial Strength On Upbeat Meta Earnings

After ending yesterday’s trading mixed, stocks are likely to move mostly higher in early trading on Thursday. The major index futures are currently pointing to initial strength on Wall Street, with the S&P 500 futures up by 0.4 percent.

Early buying interest may be generated in reaction to upbeat earnings news from Facebook parent Meta Platforms (META).

Shares of Meta are spiking by 13.4 percent in pre-market trading after the company reported better than expected first quarter results and provided upbeat guidance for the current quarter.

Drug giants Merck (MRK) and Eli Lilly (LLY) may also move to the upside after reporting better than expected quarterly earnings.

Meanwhile, shares of Caterpillar (CAT) are seeing modest pre-market weakness even though the construction equipment maker reported first quarter results that exceeded estimates.

The futures gave back some ground following the release of a Commerce Department report showing U.S. economic growth slowed by much more than expected in the first three months of 2023.

The report said real gross domestic product increased by 1.1 percent in the first quarter after jumping by 2.6 percent in the fourth quarter of 2022. Economists had expected the pace of GDP growth to slow to 2.0 percent.

The Commerce Department said the slowdown in GDP growth primarily reflected a downturn in private inventory investment and a slowdown in non-residential fixed investment.

A separate report from the Labor Department showed first-time claims for U.S. unemployment benefits unexpectedly declined in the week ended April 22nd.

The report said initial jobless claims dipped to 230,000, a decrease of 16,000 from the previous week’s revised level of 246,000.

Economists had expected jobless claims to inch up to 248,000 from the 245,000 originally reported for the previous week.

Not long after the start of trading, the National Association of Realtors is due to release its report on pending home sales in the month of March. Pending home sales are expected to increase by 0.5 percent in March after climbing by 0.8 percent in February.

Following the sell-off seen in Tuesday’s session, the major U.S. stock indexes turned in a mixed performance during trading on Wednesday. While the tech-heavy Nasdaq bounced off its lowest closing level in almost a month, the Dow and the S&P 500 saw further downside.

The Nasdaq pulled back well off its best levels of the day but still closed up 55.19 points or 0.5 percent at 11,854.35. Meanwhile, the Dow slid 228.96 points or 0.7 percent to 33,301.87, and the S&P 500 fell 15.64 points or 0.4 percent to 4,055.99.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan’s Nikkei 225 Index edged up by 0.2 percent, while China’s Shanghai Composite Index climbed by 0.7 percent.

Meanwhile, the major European markets are turning in a mixed performance on the day. While the U.K.’s FTSE 100 Index is down by 0.1 percent, the German DAX Index is up by 0.2 percent and the French CAC 40 Index is up by 0.4 percent.

In commodities trading, crude oil futures are rising $0.33 to $74.63 a barrel after plummeting $2.77 to $74.30 a barrel on Wednesday. Meanwhile, after falling $8.50 to $1,996 an ounce in the previous session, gold futures are inching up $0.10 to $1,996.10 an ounce.

On the currency front, the U.S. dollar is trading at 133.92 yen versus the 133.67 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.1010 compared to yesterday’s $1.1041.

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