Tech stocks, banks set to drag Wall St lower at open By Reuters

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© Reuters. A child leaps off a bench outside the NYSE in New York

By Devik Jain

(Reuters) -Wall Street’s main indexes were set to open lower on Thursday, dragged down by technology and bank stocks, while data showed jobless claims fell last week as the labor market continued to limp out of a coronavirus-induced recession.

The Labor Department’s weekly jobless claims report, the most timely indicator of economic health, showed initial claims for state unemployment benefits fell to 684,000 for the week ended March 20 from 781,000 in the previous week.

“Most investors have assumed that we will return to a much more normal economy after this summer,” said Rick Meckler, a partner at Cherry Lane Investments in New Vernon, New Jersey.

“They’re assuming that the numbers today are not that meaningful if you consider that the economy potentially completely re-opens later in the year.”

The technology-heavy has fallen this month as rosy economic projections lifted demand for undervalued stocks including energy, mining and industrial firms, but raised fears of higher inflation and a potential tax hike.

In testimonies to Congress this week, Federal Reserve Chair Jerome Powell expressed optimism about a strong U.S. economic rebound, while Treasury Secretary Janet Yellen said future tax hikes will be needed to pay for public investments.

President Joe Biden is expected to lay out a new goal for U.S. vaccinations against COVID-19 at his first formal White House news conference beginning at 1:15 p.m. ET (1715 GMT). Next week, he is also set to unveil a multitrillion-dollar infrastructure plan in Pittsburgh.

“It’s a tale of two different markets at this point and it depends on what the market wants to focus on,” said Faron Daugs, founder and chief executive officer of Harrison Wallace Financial Group.

“Does it want to focus on stimulus, increased vaccinations and re-opening economies or on potential taxes, increased regulation potentially in certain sectors, extremely high spending and inflation.”

Economically sensitive bank stocks including JPMorgan Chase & Co (NYSE:), Citigroup (NYSE:), Wells Fargo (NYSE:), Goldman Sachs (NYSE:) and Bank of America (NYSE:) gave up early gains to fall between 0.3% and 0.7% in premarket trading.

Heavyweight tech stocks Facebook Inc (NASDAQ:), Google parent Alphabet (NASDAQ:) Inc and Twitter Inc (NYSE:) fell between 0.8% and 2.7% ahead of their chief executives’ testimony before Congress about extremism and misinformation on their services.

At 8:50 a.m. ET, were down 144 points, or 0.45%, were down 17 points, or 0.44%, and were down 70.25 points, or 0.55%.

Shares of Nike Inc (NYSE:) fell 5.7% as the sporting goods giant faced a Chinese social media backlash over its comments about reports of forced labor in Xinjiang.

U.S.-listed shares of Baidu Inc (NASDAQ:), Alibaba (NYSE:) Group Holding Ltd and JD (NASDAQ:).Com Inc were subdued after the U.S. securities regulator adopted measures that would kick foreign companies off stock exchanges if they do not comply with U.S. auditing standards.

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