Investors avoid extending September rally before reports on weekly unemployment claims

Stock futures dip ahead of jobs, inflation data

NEW YORK — Investors again appeared ready to put the market’s September rally on hold Thursday, at least temporarily, as they await key readings on unemployment, inflation and manufacturing. Stock futures fell modestly.

Futures also fell Wednesday and stocks opened the day lower, but an upbeat report on industrial production turned the market around and major indexes closed with modest gains.

Strong reports Thursday could provide the same spark to extend the rally that has seen the Dow Jones industrial average rise nine of the past 11 days and jump 5.6 percent this month.

During the recent run, investors have been heartened by economic reports that indicate the economy continues to grow slowly, but faster than economists had anticipated. Reports on jobs and manufacturing in particular have topped forecasts, driving stocks higher.

The Labor Department is expected to report first-time claims for unemployment benefits rose slightly last week to 460,000, according to Thomson Reuters. Claims have dropped sharply over the past three weeks, which has been a primary driver of the rally.

Unemployment claims have hovered near 450,000 throughout most of the year. It’s a level that signifies employers aren’t ramping up hiring significantly, but that they’ve also put a halt on layoffs. High unemployment remains the biggest obstacle to a stronger recovery.

The Philadelphia Federal Reserve’s regional manufacturing report for the Mid-Atlantic region is also scheduled for release Thursday. Economists predict the index will turn positive again this month after falling to minus-7.7 in August. Any reading above zero indicates growth.

A report Wednesday that showed growth in manufacturing activity slowed in New York this month initially dampened enthusiasm in the market.

A third report on prices at the wholesale level is expected to show inflation remains benign. The Producer Price Index likely rose 0.3 percent last month, due largely to rising food and energy prices.

Ahead of the opening bell, Dow Jones industrial average futures fell 26, or 0.3 percent, to 10,483. Standard & Poor’s 500 index futures fell 3.30, or 0.3 percent, to 1,117.40, while Nasdaq 100 index futures fell 2.00, or 0.1 percent, to 1,937.50.

The S&P 500 is approaching a key technical level as well. It closed Wednesday at 1,125.07.

Over the past few days it has approached the 1,131 level, which it has not touched since June. Technical levels are considered very important, particularly because electronic trading is so prevalent now. Traders often use technical indicators to set automatic buy or sell orders, so gains or losses can accelerate when hitting those points.

In corporate news, FedEx Corp. said its fiscal first-quarter earnings doubled, but the company plans to cut 1,700 jobs as it consolidates its trucking operations to save money. The company also raised its quarterly earnings outlook, but the forecast was still shy of analysts expectations.

Shares fell $2.27, or 2.6 percent, to $83.67 in pre-opening trading.

Meanwhile, bond prices traded in a narrow range. The yield on the 10-year Treasury note, which moves opposite its price, was unchanged at 2.72 percent, compared with late Wednesday. Its yield is used to help set interest rates on mortgages and other consumer loans.

Overseas markets were relatively flat as well. Britain’s FTSE 100 fell 0.2 percent, Germany’s DAX index fell 0.1 percent, and France’s CAC-40 fell 0.3 percent. Japan’s Nikkei stock average fell 0.1 percent a day after it surged more than 2 percent as the country’s government stepped in to weaken the currency.