Thursday will be a busy day with two key data releases an hour before the opening bell and another housing report half an hour into the session. There are also two energy-releases, multiple Treasury auctions, and once markets close Richard Fisher from the Dallas Federal Reserve will speak in Washington on the economic outlook.
Prior to the data releases, investor sentiment looks set to pare some of Wednesday’s losses. S&P 500 futures are up 2.9 points to 895.4, Dow futures have climbed 30 points higher to 8327, and Nasdaq futures have moved up 5 points to 1409.
At 8:30 am, analysts expect to the April release of Durable Goods to bounce 0.5% after declining 0.8% in March. Expectations are highly mixed with some economists expecting a 2.0% fall while others looking for a 2.0% advance.
Defense orders are expected to have a positive impact in the report, as are motor vehicles, but generally output is struggling across the board.
Analysts from IHS Global Insight look for a 0.8% advance in April. “Orders excluding volatile items like aircraft and defense are starting to cool their rate of decline, and April is shaping up as just a soggy/weak month after a succession of dismal months,” said U.S. economists Brian Bethune and Nigel Gault.
The weekly release of Jobless Claims is also released at 8:30 am. Most analysts see no reason for initial claims to rise or fall dramatically this week: the consensus looks for628k new claims for the week ending May 23, following 631k claims in the prior week. John Herrmann from Herrmann Forecasting believes claims could fall this week, but that initial claims could see a sharp increase by June.
“Over the past two weeks, weekly jobless claims have boosted by Chrysler’s bankruptcy filing,” he said. “So, we look for a temporary dip in claims this week. GM’s anticipated bankruptcy filing (around June 1st) is expected to boost weekly claims over the three-four weeks of June towards 700.0k.”
Continuing claims ― all people receiving unemployment benefits ― is likely to hit another all-time high for the week ending May 15, following a print of 6.662 million in the prior week.
Half an hour into Thursday’s session, New Home Sales are expecting to show a minor gain in April to a seasonally-adjusted annual pace of 360k, compared to 356k in the prior month.
This is the third day of housing-related data to come out this week, and so far the news has been mixed. Prices have continued to fall, existing-home sales ticked upwards, but inventories of previously-owned homes rebounded to unhealthy levels.
IHS Global Insight said the new homes sales report could point to market stabilization.
“Single-family housing starts and permits and builder confidence have improved since January, and were all up in April,” they said. “Stronger demand (i.e. new home
sales) probably accounts for these recent improvements, and we project that new home sales increased to 368,000 units (annualized) in April.”
After all of that data, the EIA will post a Natural Gas report at 10:30 and a Petroleum report at 11:00. In addition, Treasury will hold three auctions at 11:00 and another at 1pm.
Richard Fisher from the Dallas Fed speaks in Washington on the economic outlook at 5:45pm.