US stocks firmed on Thursday but investors, bruised by a falling oil price, were also wary about Friday payrolls data and whether more bank regulation is actually in the pipeline.
The S&P 500 ended the day up 0.08% at 2,364, the Dow Jones Industrial Average was little changed at 20,859 and the Nasdaq Composite inched up 0.05% to 5,840.
Friday’s payrolls report from the labour department has taken on increased significance as expectations for a Federal Reserve rate rise this month have been ratcheted higher by recent hawkish comments among senior officials.
Wall Street economists reckon the world’s biggest developed market economy added about 200,000 jobs last month.
The velocity of the numbers could give the nod to a March 15 Federal rate hike, which most traders fully expect to be on the cards anyway.
But rather than give impetus to bank stocks – for whom the rate hike is already fully priced in - financials had new challenges to face on Thursday. Although banks did not fall as a sector on Thursday, their daily gains were crimped.
In response to a question on Thursday about whether US President Donald Trump still wants to bring back Glass-Steagall - a campaign promise he made during last year’s election campaign to revisit the Great Depression era law — White House press secretary Sean Spicer said that he was.
The 1933 regulation prohibited commercial deposit-holding banks from engaging in riskier investment banking activities and runs counter to the recent relaxed state of banks on hopes that a lot of the Dodd-Frank legislation of the Obama years will be rolled back.
Meanwhile, energy stocks suffered as oil prices continued to sag after mid-week data from the EIA showed a shock rise in crude oil inventories. The WTI future was down 1.4% at $49.58.
The main riser on the S&P 500 was Signet Jewelers Ltd (NYSE:SIG), up 8.7% to $70.02.
The S&P Midcap 400 ended down 0.4% at 1703 and led by building materials group Eagle Materials Inc (NYSE:EXP) down 4.7% to $96.46 while the S&P Smallcap 600 ended down 0.5% at 827 and led by Tailored Brands Inc (NYSE:TLRD) down 32.2% to $15.84.
Early trading
US stocks rose early on Thursday, as investors were cautious in the wake of lower oil prices and leaving nothing to chance ahead of Friday’s non-farm payrolls report.
The S&P 500 climbed 0.2% to 2,366, the Dow Jones Industrial Average was up by the same margin to 20,878, as was the Nasdaq Composite at 5842.
The energy sector posted the biggest decline, dipping 0.5% and extending its losses for the week to around 4%.
The US oil benchmark West Texas Intermediate, dropped as much as 3% to $48.79 a barrel. It had not traded below $50 on an intraday basis since mid-December. It was last down 1.9% at $49.31.
The top gainer on the S&P 500 was troubled Signet Jewelers Ltd (NYSE:SIG), up 4.8% at $67.50 despite earlier reporting missed sales estimates and presented a dimmer-than-expected outlook.
But the stock redeemed itself after the firm said it was going to cut back stores and invest in more digital.
Read: Signet Jewelers plans to cut stores, invest in digital after fourth-quarter sales fall
The S&P Midcap 400 was up 0.1% at 1711 and led by Tech Data Cp (NASDAQ:TECD) up 4% at $93.53 and the S&P Smallcap 600 advanced by 0.1% to 832 and led by Comtech Telecom Co (NASDAQ:CMTL) up 18% to $13.14.
Pre-Open
US stocks were set to extend their previous session’s losses when the market reopens on Thursday, as oil prices continued to tumble after mid-week EIA data shocked investors with another huge glut reading for inventories.
Meanwhile a clutch of corporate news, especially from the retailing sector, wasn’t helping buttress any decline for markets either.
The S&P 500, Dow Jones Industrial Average and Nasdaq Composite were all indicated 0.05% lower.
For investors who still like to believe history is a guide to the future, thought, Thursday marks the eighth year when the S&P 500 began a 250% bull run out of the debris of the previous year’s collapse of Lehman Brothers and the start of emergency low interest rates from the Federal Reserve.
Still, it takes a disaster to create a winner. The current bull run would need to carry on, with hiccups along the way no doubt, for a further four years to match the longest bull run in Wall Street history – the period sandwiched between Black Tuesday’ crash in 1987 and the dot-com bubble bursting in 2000.
But this time, eight years is starting to feel like eight years as the analysts complain that the pulse is starting to peter out. Momentum is being lost.
Instead the focus on Thursday is going to be oil again. The US oil benchmark West Texas Intermediate future was off 1.9% at $49.35, as barrels priced below a first psychological test of $50. Their current levels were also 10% below a recent peak in February.
Dismal earnings from the parent company of Men's Wearhouse saw Tailored Brands (NYSE:TLRD) shares plummet as much as 27% after hours after the firm posted fourth quarter results. The shares were 28.1% down at $16.80 pre-market.
Like many retailers, Tailored Brands has been hit by online shopping and declining foot traffic at malls.
Signet Jewelers shares (NYSE:SIG) were off 1% at $63.78 pre-market after the troubled group missed sales estimates and presented a dimmer-than-expected outlook.
But that was small earrings compared with Staples Inc (NASDAQ:SPLS) whose shares were down 6.8% at $8.35 pre-market after printing below-forecast fourth quarter earnings.
US paintmaker PPG Industries hinted it is not walking away from a tilt at Akzo Nobel, despite its Dutch rival rejecting a €20.9bn takeover approach.
The Pittsburgh-based chemicals manufacturer said it still believed there was a “strong strategic rationale” for a combination of the two companies, and would “carefully evaluate and consider its position and path forward related to its proposal”.
PPG’s unsolicited bid valued shares in Akzo Nobel, which owns the Dulux brand of paints, at €83 each and comprised €54 in cash and in 0.3 PPG stock. That is roughly a 29% premium to Akzo Nobel’s undisturbed share price at the close yesterday.
There was no gloss on its shares, as PPG was down 1% to $105.76 pre-market.
In data, the number of Americans applying for first-time unemployment benefits climbed last week but remained at a low level consistent with a healthy labour market and should do little to dampen the view among investors that the Federal Reserve will move to raise interest rates when it meets next week.
US jobless claims rose by 20,000 to 243,000 last week, and off their near 44-year lows.
Talking of job losses, Peter Hancock is set to resign his post at insurance giant AIG (NYSE:AIG) as the president and chief executive officer said that there had been a lack of shareholder support for his continued role at the helm.
His departure comes less than a month after the group reported a $3bn quarterly loss that raised fresh concerns about the insurer’s recovery efforts.
AIG shares were up 1.6% at $64.45 pre-market.
Another gainer was Sears after its fourth quarter earnings landed better than the Street expected.
Sears Holdings (NASDAQ:SHLD) continued to bleed red ink during the fourth quarter, with the struggling US department store operator posting a net loss of more than $600m, bringing total losses to over $10bn in five years.
The company, which also owns Kmart, saw net losses swell to $607m in the three months to end of January, compared to a loss of $580m a year ago as cratering sales and mounting debt forced it to take yet another big writedown.
But Sears shares were up 12.4% at $8.42 pre-market.
But the one of the best gainers pre-market was Apricus Biosciences Inc.(NASDAQ:APRI). Shares gained 25.5% to $3.49 before the bell after the firm said it completed the sale to Ferring International Center of Apricus’ ex-US assets and rights related to Vitaros, Apricus’ on-demand topical cream indicated for the treatment of patients with erectile dysfunction.