U.S. Stocks Likely To Regain Ground After Yesterday’s Sharp Pullback

Following the sharp pullback seen late in the previous session, stocks are likely to move back to the upside in early trading on Thursday. The major index futures are currently pointing to a higher open for the markets, with the S&P 500 futures up by 0.7 percent.

The upward momentum on Wall Street comes as traders may see yesterday’s sell-off as an opportunity to pick up stocks at somewhat reduced levels following the recent upward trend.

The futures saw further upside following the release of revised Commerce Department data showing the U.S. economy grew by less than previously estimated in the third quarter.

The report said real gross domestic product jumped by 4.9 percent in the third quarter, reflecting a downwardly revision from the previously reported 5.2 percent surge. Economists had expected the pace of GDP growth to be unrevised.

The Commerce Department said the slower than previously estimated GDP growth primarily reflected a downward revision to consumer spending.

While third quarter GDP growth remains relatively strong, the downward revision may add to optimism about the Federal Reserve cutting interest rates early next year.

A separate report released by the Labor Department on Thursday showed a slight uptick by initial jobless claims in the U.S. in the week ended December 16th.

The Labor Department said first-time claims for U.S. unemployment benefits crept up to 205,000, an increase of 2,000 from the previous week’s revised level of 203,000.

Economists had expected jobless claims to rise to 215,000 from the 202,000 originally reported for the previous week.

The Federal Reserve Bank of Philadelphia also released a report showing regional manufacturing activity unexpectedly contracted at an accelerated rate in the month of December.

Not long after the start of trading, the Conference Board is due to release its report on leading economic indicators in the month of November. The leading economic index is expected to decrease by 0.4 percent in November after…