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Jul 7, 2016

U.S.Stock Market Future Indications, By MarketWatch on July 7, 2016: U.S. Stock Futures Waver as Focus Turns From Brexit to Jobs Report

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Wall Street was set for moderate gains on Thursday, with investors shaking off Brexit fears and instead turning their attention to a key U.S. jobs report out on Friday.

A rise in oil prices also helped propel a positive trading mood premarket after data showed a drop in crude stockpiles.
Futures for the Dow Jones Industrial Average YMU6, -0.01%  rose 11 points, or 0.1%, to 17,845, while those for the S&P 500 index ESU6, -0.07%  was flat around 2,094. Futures for the Nasdaq-100 index NQU6, +0.02%  climbed 5 points, or 0.1%, to 4,444.50.
U.S. stocks returned from the Independence Day holiday to firm Brexit-related losses on Tuesday, but rebounded on Wednesday after a stronger-than-expected report on nonmanufacturing activity and dovish Federal Reserve minutes helped nudge investors back into equities. The S&P 500 index DXY, -0.04%  ended up 0.5%, while the Dow average DJIA, +0.44%  rose 0.4%.
“The cautious tone from the FOMC minutes on Wednesday may be giving investors a lift today,” Craig Erlam, senior market analyst at Oanda, said in a note.
“The Brexit vote alone is likely to deter [the Fed] from raising rates until at least the end of the year as they wait to see what the knock-on effects will be, both from an economic and financial markets perspective,” he added.
The risk-on trading mood was broadly reflected in financial markets on Thursday, with European stocks SXXP, +1.60% the pound GBPUSD, +0.7424%  and 10-year U.S. Treasury yields TMUBMUSD10Y, +1.04%  moving higher.
Oil boost: Oil prices also rose, building on a gain from Wednesday, after data from American Petroleum Institute showed crude supplies fell 6.7 million barrels for the week ended July 1. Analysts had forecast a 2.6 million-barrel decline in stockpiles.
Crude oil CLQ6, +0.97%  jumped on Thursday 1.3% to $48.06 a barrel, while BrentLCOU6, +0.90%  added 1.3% to $49.44.
Economic news: The highlight on the economic calendar on Thursday is the ADP private-payrolls report, due out at 8:15 a.m. Eastern Time.
The report — seen as a precursor for the top-tier nonfarm payrolls report out on Friday — is expected to show 150,000 jobs were added in June, according to FactSet estimates, compared with 173,000 in May.
Analysts at Deutsche Bank pointed out, however, that the May ADP print “severely overstated” the strength of the nonfarm report for the same month. Only 38,000 nonfarm jobs were created in May, a significant miss, compared with expectations. For June, economists polled by MarketWatch expect the nonfarm payrolls report to come in at 170,000 and the unemployment rate to have risen to 4.8% from 4.7%.
Later on Thursday, weekly jobless claims are due at 8:30 a.m. Eastern. Forecasts are for 265,000 Americans to have filed for unemployment benefits last week, down slightly from the 268,000 the week before. See:MarketWatch’s economic calendar
No Federal Reserve members are scheduled to speak publicly today. Minutes from the European Central Bank’s June meeting, due at 12:30 p.m. London time, or 7:30 a.m. Eastern Time, may signal what policy makers are thinking about easing.
Movers and shakers: Shares of WhiteWave Foods Co. WWAV, +18.91%  rallied 16% in thin premarket trade after French dairy giant Danone SA BN, +4.26%  said it’s buying the organic-foods producer for about $10 billion.
Western Digital Corp. WDC, +1.65%  could also be active after the maker of computer disk drives late Wednesday raised its quarterly earnings outlook.
Shares of SemiLEDS Corp. LEDS, +17.41%  soared 64% ahead of the bell after the LED chips maker late Wednesday said Peter Chiou will buy 577,000 shares of the company’s common stock at $5.00 per share. SemiLEDS shares closed at $3.30 on Wednesday.
In earnings news, PepsiCo Inc. PEP, -0.47%  is slated to report results ahead of the bell, while PriceSmart Inc. PSMT, +1.45%  and WD-40 Co. WDFC, -2.49%  will release earnings after the market closes.
Other markets: Asian markets ended mostly higher following Wednesday’s higher close on Wall Street. However, Japan’s Nikkei 225 index NIK, -0.67%  ended down 0.7% as the yen remained stubbornly high.
European markets SXXP, +1.60%  rose across the board, taking a breather after three days of Brexit-related losses.
Gold GCQ6, -0.03%  was marginally higher, while the dollar DXY, -0.04%  fell against most other major currencies.