Dipo Olowookere
By Investors Hub
The major US index futures are pointing to a roughly flat open on Friday following the weakness seen in the previous session. The futures pulled back following the release of a report from the Commerce Department unexpectedly showing a steep drop in housing starts in the month of May.
Following the mixed performance seen on Wednesday, stocks moved mostly lower during trading on Thursday. The major averages regained ground after an early move to the downside but remained stuck in negative territory.
The Dow edged down 14.66 points or 0.1 percent to 21,359.90, the Nasdaq fell 29.39 points or 0.5 percent to 6,165.50 and the S&P 500 dipped 5.46 points or 0.2 percent to 2,432.46.
The weakness on Wall Street came as traders continued to digest the Federal Reserve’s decision to raise interest rates by a quarter point on Wednesday.
Traders were also reacting to a slew of U.S. economic data, including a report from the Labor Department showing a bigger than expected drop in initial jobless claims in the week ended June 10th.
The report said initial jobless claims fell to 37,000, a decrease of 8,000 from the previous week’s unrevised level of 245,000. Economists had expected jobless claims to drop to 242,000.
A separate report released by the Labor Department showed a bigger than expected drop in import prices in the month of May, reflecting a steep decline in prices for fuel imports.
The Labor Department said its import price index fell by 0.3 percent in May after rising by 0.2 percent in April. Economists had expected import prices to edge down by 0.1 percent.
The report also said export prices slid by 0.7 percent in May following a 0.2 percent increase in the previous month. Export prices had been expected to inch up by 0.1 percent.
Growth in Philadelphia-area manufacturing activity slowed in the month of June, according to a report released by the Federal Reserve Bank of Philadelphia.
The Philly Fed said its index for current manufacturing activity in the region decreased to 27.6 in June from 38.8 in May, although a positive reading still indicates growth. The index had been expected to drop to 24.0.
After reporting a contraction in regional manufacturing activity in the previous month, the Federal Reserve Bank of New York released a report showing a rebound in activity in the month of June.
The New York Fed said its general business conditions index shot up to 19.8 in June from a negative 1.0 in May, with a positive reading indicating growth in regional manufacturing activity. Economists had expected the index to rise to 4.0.
The Fed also released a report this morning showing that U.S. industrial production was unchanged in the month of May.
The Fed said industrial production was flat in May after jumping by 1.1 percent in April. Economists had expected production to rise by 0.2 percent.
Meanwhile, homebuilder confidence in the U.S. unexpectedly decreased in the month of June, according to a report released by the National Association of Home Builders on Thursday.
The report said the NAHB /Wells Fargo Housing Market Index dropped to 67 in June from 69 in May. The decrease surprised economists, who had expected the index to inch up to 70.
Steel stocks showed a substantial move to the downside on the day, dragging the NYSE Arca Steel Index down by 2.6 percent.
Energy, gold and retail stocks also saw considerable weakness on the day, moving lower along with most of the other major sectors.
