U.S. Stocks May Give Back Ground Following Yesterday’s Rally

After ending the previous session sharply higher, stocks are likely to move back to the downside in early trading on Thursday. The major index futures are currently pointing to a lower open for the markets, with the S&P 500 futures down by 0.4 percent.

Traders may look to cash in on yesterday’s gains amid lingering concerns about the economic outlook following the Federal Reserve’s monetary policy announcement on Wednesday.

The Fed announced its widely expected decision to leave interest rates unchanged, but forecasts suggest officials still expect to resume cutting rates later this year.

However, the Fed officials also lowered their projections for GDP growth in 2025 to 1.7 percent from 2.1 percent and raised their forecasts for consumer price growth this year to 2.7 percent from 2.5 percent.

Fed Chair Jerome Powell said during his post-meeting press conference that a “good part” of the higher inflation forecast is due to tariffs.

In U.S. economic news, the Labor Department released a report showing first-time claims for unemployment benefits crept slightly higher in the week ended March 15th.

The report said initial jobless claims inched up to 223,000, an increase of 2,000 from the previous week’s revised level of 221,000.

Economists had expected jobless claims to rise to 224,000 from the 220,000 originally reported for the previous week.

A separate report released by the Federal Reserve Bank of Philadelphia said regional manufacturing activity expanded overall but was less widespread in the month of March.

Not long after the start of trading, the National Association of Realtors is scheduled to release its report on existing home sales in the month of February.

Existing home sales are expected to decrease to an annual rate of 3.95 million in February after tumbling to a rate of 4.08 million in January.

The Conference Board is also due to release its report on leading economic indicators in the month of February. The leading economic index is expected to dip by 0.2 percent in February after falling by 0.3 percent in January.

Following the sharp pullback seen in Tuesday’s session, stocks showed a strong move back to the upside during trading on Wednesday. With the rally, the major averages largely offset Tuesday’s steep losses.

The major averages pulled back off their best levels going into the close but remained sharply higher. The Nasdaq surged 246.67 points or 1.4 percent to 17,750.79, the S&P 500 jumped 60.63 points or 1.1 percent to 5,675.29 and the Dow climbed 383.32 points or 0.9 percent to 41,964.63.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Thursday, with the Japanese markets closed for a holiday. Hong Kong’s Hang Seng Index plunged by 2.2 percent, while Australia’s S&P/ASX 200 Index jumped by 1.2 percent.

Meanwhile, the major European markets have all moved to the downside on the day. While the U.K.’s FTSE 100 Index is down by 0.3 percent, the French CAC 40 Index is down by 1.1 percent and the German DAX Index is down by 1.6 percent.

In commodities trading, crude oil futures are rising $0.11 to $67.27 a barrel after climbing $0.26 to $67.16 a barrel on Wednesday. Meanwhile, after inching up $0.40 to $3,041.20 an ounce in the previous session, gold futures are edging up $5.20 to $3,046.40 an ounce.

On the currency front, the U.S. dollar is trading at 148.62 yen versus the 148.69 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.0841 compared to yesterday’s $1.0903.

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