Stock futures inch higher after JPMorgan beats forecasts; investors await jobs, inflation data

Stock futures rise modestly after JPMorgan results

NEW YORK — Stock futures rose modestly Thursday, but were off their highs, as investors sorted through a glut of economic data that continued to show the economy is slowing down.

Futures got a boost early in the day after banking giant JPMorgan Chase & Co. became the latest company to report strong quarterly results. Strong earnings have lifted the market in recent days, helping the Dow Jones Industrial average run its winning streak to seven sessions.

Even though companies have reported strong earnings and upbeat outlooks, economic reports continue to show the economy remains fragile.

A regional manufacturing report from New York plummeted this month, and the government said initial jobless claims fell largely because of seasonal factors. The crosscurrents from earnings and economic reports kept big moves in check Thursday.

JPMorgan Chase easily topped earnings forecasts, following others like Intel Corp. and Alcoa Inc. in reporting strong results. The bank also cut down its loan-loss reserves, which could be a sign that mortgage and loan defaults are moderating.

However, JPMorgan’s CEO Jamie Dimon still struck a cautious tone about future economic growth. Dimon has regularly been cautious about the recovery.

Ahead of the opening bell, Dow Jones industrial average futures rose 10, or 0.1 percent, to 10,316. Standard & Poor’s 500 index futures rose 1.10, or 0.1 percent, to 1,092.20, while Nasdaq 100 index futures rose 4.00, or 0.2 percent, to 1,855.25.

Initial jobless claims fell by 29,000 to a seasonally adjusted 429,000, the lowest level since August 2008. Economists polled by Thomson Reuters had predicted claims would drop to 450,000.

However, the initial claims could be skewed because General Motors and other manufacturers skipped their usual July shutdowns. Normally that would lead to temporary seasonal layoffs, which did not show up in the latest figures.

High unemployment remains one of the biggest obstacles to a strong, sustained recovery. So normally investors would be optimistic about such a sharp drop in claims. But since the seasonal layoffs did not occur, the drop in claims is largely being written-off.

The steep drop in the Empire State Manufacturing index is also likely tempering optimism that had been seen in recent days following strong earnings. Manufacturing had shown the most consistent growth coming out of the recession, but now data is indicating it too is slowing down heading into the second half of the year.

The index fell to 5.08, well below the 18.50 economists had predicted and the 19.57 that was seen last month. The Philadelphia Fed releases its regional manufacturing report and the government releases its industrial production survey later Thursday.

The government’s report is expected to show output at the nation’s factories, mines and utilities fell by 0.1 percent in June after rising 1.3 percent a month earlier.

Economists are predicting the Philly Fed’s index will climb.

Meanwhile, inflation before goods reach the consumer level fell more than expected last month. It dropped 0.5 percent, compared with a forecast for a decline of 0.1 percent.

A drop in energy costs and the biggest plunge in food costs in eight years kept inflation at bay. The drop in prices should allow the Federal Reserve to hold key interest rates at historically low levels to try and stimulate the economy.

The Dow eked out a gain of 4 points Wednesday to extend its winning streak to seven days. However, the S&P 500 snapped its run of gains by falling less than 1 point. A mixed picture of the economy continued to play out Wednesday, pulling investors in two directions.

Early earnings reports remained strong. Investors were upbeat after chipmaker Intel Inc. reported a better-than-expected profit and provided a positive outlook for the rest of the year. However, economic data again disappointed. This time it was sagging retail sales that diminished excitement for future growth.

The Federal Reserve also was cautious about future growth in the minutes from its June meeting that were released Wednesday. The Fed lowered its outlook for the gross domestic product, the broadest measure of the economy.

The euro climbed above $1.28 for the first time in more than two months Thursday as investors worried about the strength of growth in the U.S.

Bond prices were narrowly mixed ahead of the crush of economic data. The yield on the benchmark 10-year Treasury note, which moves opposite its price, was unchanged at 3.05 percent compared with late Wednesday.

Overseas, Britain’s FTSE 100 rose 0.1 percent, Germany’s DAX index gained 0.3 percent, and France’s CAC-40 rose 0.2 percent. Japan’s Nikkei stock average fell 1.1 percent.