US open: Stocks trade higher after jobless claims hit fresh pandemic-era low

Wall Street stocks were in the green early on Thursday as investors mulled over several key data points.

As of 1525 BST, the Dow Jones Industrial Average was up 0.33% at 35,429.09, while the S&P 500 was 0.32% firmer at 4,538.66 and the Nasdaq Composite came out the gate 0.19% stronger at 15,338.36.

The Dow opened 116.56 points higher on Thursday, reversing losses recorded in the prior session as market participants digested a number of major data points.

Thursday's primary focus was weekly jobless claims numbers, which revealed the number of Americans filing for unemployment claims continued to drop at the end of August. According to the Department of Labor, in seasonally adjusted terms, initial jobless claims fell by 14,000 during the week ended 28 August to reach 340,000. Secondary unemployment claims retreated by 160,000 to approximately 2.75m.

Traders thumbed over the report for any potential hints as to how tomorrow's big August jobs report, which could show how fast the Federal Reserve will remove easy monetary policy, might play out.

Also on the macro front, America's shortfall in trade with the rest of the world shrank last month as exports picked up. According to the Department of Commerce, in seasonally adjusted terms, the foreign deficit narrowed by 4.3% month-on-month to reach -$70.1bn, with exports up 1.3% on the month at $212.8bn and imports down 0.2% at $282.9bn.

Elsewhere, unit labour costs in the US grew a bit more quickly than anticipated during the second quarter, revised data showed. According to the Department of Labor, in seasonally adjusted terms, unit labour costs increased at a quarter-on-quarter pace of 1.3% over the three months to June. That was higher than the preliminary estimate of 1.0%.

Lastly, US factory orders grew 0.4% month-on-month in July, slightly beating expectations for a print of 0.3% but still well short of the previous month's 1.5% increase.

Also in focus, OPEC+ agreed to stick to its initial plan of enhancing its oil supply by 400,000 barrels per day per month, gradually eliminating its unprecedented supply reductions caused by the Covid-19 pandemic. However, it did raise its demand forecast for 2022 amid pressure from the Biden administration to ramp up production.

In the corporate space, chipmaker Broadcom will report earnings after the close of trading.