By Barbara Kollmeyer, MarketWatch
China stocks tumble after growth downgraded
NEW YORK (MarketWatch) -- U.S. stock futures trimmed earlier
gains Thursday following a raft of weaker-than-expected economic
reports, including jobless claim.
A spate of gauges of U.S. economic health rolled out as Mario
Draghi, president of the European Central Bank began a news
conference, after leaving key interest rates unchanged, announcing
that the central bank would kick off a trillion-dollar plan to
purchase government bonds March 9.
Futures for the Dow Jones Industrial Average (DJH5) rose 37
points to 18,123. The same held true for S&P 500 index (SPH5)
futures, up 4.2 points to 2,100, and those for the Nasdaq-100
(NDH5), up 8.75 points to 4,452.7.
U.S. stocks logged the second straight session of losses on
Wednesday, with the S&P 500 (SPX) hitting its lowest level in
two weeks. Among the disappointments was private-sector employment
data, which is used by economists to get a feel for the bigger
employment report, due Friday.
The Nasdaq Composite (RIXF) also has pulled back further from
its psychological milestone of 5,000, which it hit Monday.
Read: The 3 things most likely to kill the bull market's buzz
(http://www.marketwatch.com/story/the-3-things-most-likely-to-kill-the-bull-market-2015-03-04)
As well as nervousness ahead of nonfarm payrolls, global
economic worries were back in the headlights for investors after
China -- viewed as the world's growth engine -- cut its economic
growth forecast to around 7% this year.
Read: China lowers growth target
(http://www.marketwatch.com/story/china-lowers-growth-target-to-about-7-2015-03-04-191032533)
Draghi ahead:Live blog: ECB to begin government bond purchases
on March 9
(http://blogs.marketwatch.com/thetell/2015/03/05/european-central-bank-live-blog-draghi-expected-to-offer-qe-details/)
The euro (EURUSD) continued to hit fresh 11-year lows
(<p>http://www.marketwatch.com/story/euro-sinks-to-fresh-11-year-low-as-ecb-looms-2015-03-05%3c/p%3e%3cp/%3e)
ahead of that meeting.
Read: 5 things to know about the ECB's QE ahead of key meeting
(http://www.marketwatch.com/story/5-things-for-investors-to-know-about-the-ecbs-qe-ahead-of-thursdays-meeting-2015-03-04)
Economic data: The number of people who applied for U.S.
unemployment benefits shot up to 320,000 in the week ended Feb. 28,
marking the highest level since last May. Economists polled by
MarketWatch had expected claims to fall to a seasonally adjusted
301,000.
Fourth-quarter productivity fell 2.2%, (originally down 1.8%)
while unit labor costs increased 4.1%, from originally reported
3.1%. Factory orders for January are due at 10 a.m. Eastern.
San Francisco Federal Reserve President John Williams, who is a
voting member, will speak on the economic outlook at the CFA
Society of Hawaii at 11:15 p.m. Eastern.
Stocks to watch: AbbVie Inc.(ABBV) said it would buy cancer
biotech Pharmacyclics Inc.(PCYC) in a $21 billion cash-and-stock
deal. Shares of Pharmacyclics were up 9% in premarket trading.
Shares of AbbVie were down nearly 5%.
Shares of Costco Wholesale Corp.(COST) rose around 2% after the
retailer reported a quarterly profit
(http://www.marketwatch.com/story/costco-profit-up-29-helped-by-57-mln-tax-boost-2015-03-05)
that beat analysts expectations.
Specialty drugs company Mallinckrodt PLC (MNK) said it has
agreed to buy privately-held critical care company Ikaria Inc. from
an investor group led by private-equity firm Madison Dearborn, in a
deal valued at about $2.3 billion. Shares of Mallinckrodt were up
3%.
Other markets: While stock futures flattened out, European
stocks rose ahead of the ECB meeting and the euro slid.
The Hang Seng Index
(http://www.marketwatch.com/story/chinese-stocks-decline-amid-fears-of-an-economic-slowdown-2015-03-05)
fell 1.1%, the biggest daily drop in a month after China's Premier
Li Keqiang cut the country's growth target and said "economic
downward pressure is still intensifying."
In other markets, oil prices
(http://www.marketwatch.com/story/oil-fluctuates-on-chinas-lower-growth-target-libyan-supply-issues-2015-03-05-21035958)(CLJ5)
moved higher, and gold
(http://www.marketwatch.com/story/gold-looks-to-end-losing-streak-at-three-2015-03-05)(GCJ5)
was marginally lower.
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