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Stock futures erase losses, turn positive after much better-than-expected jobless claims data

Futures contracts tied to the major U.S. stock indexes erased earlier losses on Thursday after the release of better-than-expected unemployment data. 

Dow Jones Industrial Average futures were up 41 points, or 0.2%, after being down more than 100 points. S&P 500 futures posted a small gain and Nasdaq 100 futures rose 0.2%.

The Labor Department said initial jobless claims for the week ending Aug. 1 totaled 1.186 million. That’s well below a Dow Jones estimate of 1.423 million and the lowest claims levels since the pandemic began. 

The data came a day before the government’s monthly nonfarm payrolls report, which is expected to show jobs growth of 1.264 million for July.

Thursday’s report also comes as lawmakers struggle to reach a deal on a new coronavirus relief package. To be sure, the White House appeared to yield slightly on its opposition to continued federal support for unemployment benefits. The Trump team offered to extend extra federal unemployment insurance into December at $400 per week, NBC News and Politico reported.

Treasury Secretary Steven Mnuchin and White House chief of staff Mark Meadows also offered to extend a moratorium on evictions from federally backed housing into December. Democrats, meanwhile, cut their request for U.S. Postal Service funding to $10 billion from $25 billion, according to the reports.

Wall Street was coming off a solid session in which the Nasdaq Composite notched another record close and the S&P 500 ended within 2% of its Feb. 19 all-time high.

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