Investing.com — Investors await a fresh slew of U.S. economic data on Thursday after figures earlier in the week bolstered predictions that the Federal Reserve may soon end an aggressive interest rate hiking campaign. point into the green, aided by improved guidance from Salesforce (NYSE:), which boosted shares in the software group in premarket trading. Elsewhere, activity in China’s key manufacturing sector contracts, spurring on calls for Beijing to take stronger action to support the stuttering economy.
1. Futures mixed after fourth-straight winning session
U.S. stock futures were mixed on Thursday, but hovered mostly around the flatline, after the main indices on Wall Street posted their fourth winning session in a row.
At 05:13 ET (09:13 GMT), the Dow futures contract moved up by 100 points or 0.3%, added 4 points or 0.1%, and edged down by 8 points or 0.1%.
Investors are digesting a series of economic figures in recent days that have pointed to some slowing in the U.S. labor market, fueling expectations that the Fed may soon bring its long-standing cycle of interest rate hikes to a close.
In individual equities, cloud-software group Salesforce lifted its full-year revenue guidance, giving added support to Dow futures (more below).
2. Jobless claims, PCE ahead
Traders will have the chance to parse through weekly as well the personal consumption expenditures (PCE) price index, the Fed’s preferred gauge of inflation, later today.
Economists expect initial jobless claims to tick up slightly to 235,000, while the annual is seen accelerating slightly to 4.2%.
The numbers are the latest in a parade of scene-setting data points ahead of the release of the closely-watched report on Friday. The U.S. economy is projected to have added 170,000 roles in August, down from 187,000 in the previous month.
The Fed’s policy tightening campaign, which aims to cool red-hot inflation, has pushed the federal funds rate from near-zero to a range of 5.25% to 5.50% — the highest mark in more than two decades. But analysts say that signs of easing in the job market and broader economy could persuade officials at the central bank that inflationary pressures are waning, and the time to step back from rate hikes has come.
3. Salesforce raises guidance, UBS’s plans for Credit Suisse
Shares in Salesforce rose by more than 5% in premarket U.S. trading on Thursday after the software group increased its annual revenue outlook, citing strong demand for its cloud products.
Sales are now seen at between $34.7 billion to $34.8 billion in its current fiscal year, up from its prior prediction of $34.5 billion to $34.7 billion. The improved forecast added to hopes that Salesforce and other major cloud players could see a recent downturn in client spending begin to abate during the second half of 2023.
Elsewhere, UBS has announced that it will absorb the domestic unit of Credit Suisse, as the Swiss bank provided further details about its plans for the former rival it rescued in a government-brokered deal five months ago.
The move, which has been hotly debated in Switzerland ahead of national elections in October, will see Credit Suisse’s 167-year old brand eliminated and 3,000 jobs cut in the country. UBS Chief Executive Sergio Ermotti said it represented “the best outcome” for the merged lender, stakeholders and the Swiss economy.
U.S.-listed shares in UBS Group AG (NYSE:) jumped premarket, mirroring a similar rally in the stock’s Swiss listing (SIX:).
4. Chinese manufacturing activity slips
in China contracted for a fifth consecutive month in August, heaping further pressure on Beijing to do more to help reinvigorate the post-pandemic recovery of the world’s second-largest economy.
China was initially projected to bounce back strongly from draconian COVID-19 rules this year, but a string of disappointing economic figures have all but eradicated this optimism.
Meanwhile, the crucial property sector remains plagued by a liquidity crisis, a trend that was illustrated on Wednesday when China’s biggest developer Country Garden posted a $7 billion first-half loss. The once-booming export industry has also been hit by weaker global consumption.
Chinese officials have rolled out some new measures to support the economy, but have stopped short of introducing wide-ranging stimulus policies. Analysts have argued that more action may still be needed.
5. Oil volatile after Chinese data, U.S. inventories draw
Oil prices edged higher in choppy trading on Thursday, as traders digested the conflicting influences of disappointing business activity data from top crude importer China and a substantially bigger-than-expected draw in inventories.
The Energy Information Administration reported Wednesday that U.S. oil inventories shrank by 10.6 million barrels last week, well above the 3.3 million barrels expected, as refiners ramped up production before the Labor Day weekend that usually signals peak U.S. summer demand.
Markets were also watching for any more disruptions in output stemming from Idalia, which made landfall in Florida on Wednesday, and has since been downgraded from hurricane status back to a tropical storm.
By 05:16 ET, the U.S. crude futures traded 0.4% higher at $81.92 a barrel, while the contract gained 0.3% to $85.52.
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