Market bulls were probably breathing a sigh of relief after Wednesday's session considering there wasn't much follow-through selling from Tuesday. Some of that exhalation can be seen in some slight exultation in the futures market this morning.
Currently, the S&P futures are up three points and are trading a smidgen above fair value.
That's not a robust indication. Rather, it is a tentative indication in front of the vote that is expected today on the House GOP's health care reform plan.
Press reports indicate President Trump is going to meet with the House Freedom Caucus at 11:30 a.m. ET. Once that meeting is complete, it is assumed that the opportunity to vote on the plan will be at hand, yet that vote might not take place until after the market closes.
For what it's worth, the leader of the Freedom Caucus said last night that he is optimistic a deal will be reached, but that some issues still need to be worked out. The question is, will a compromise with the Freedom Caucus raise the ire of moderate Republicans and torpedo the plan's passage?
Watch for a lot of headlines on the matter today that could lead to yet another day of seesaw trading action.
At the moment, the market is clinging to the prospect of an acceptable compromise. That is the takeaway from the positive disposition of the futures market.
Should the vote get suspended without any good sense that a compromise can eventually be worked out, or should the vote happen and get shot down due to hard-line party caucus views, the market tone would be expected to turn dour since those outcomes would trigger increased angst about the fate of tax reform.
Separately, the latest jobless claims report contained a negative headline surprise. Initial claims for the week ending March 18 increased 15,000 to 258,000 (Briefing.com consensus 239,000). Continuing claims for the week ending March 11, though, decreased 39,000 to 2.000 million.
The key takeaway from the report is that it could soften March nonfarm payroll growth expectations a bit since it covered the week in which the survey for the Employment Situation Report was conducted.
The latter point notwithstanding, initial claims held below 300,000 for the 107th straight week, which can be construed as an otherwise positive reading regarding the state of the overall labor market.
The New Home Sales report for February (Briefing.com consensus 560,000; prior 555,000) will be released at 10:00 a.m. ET.
Moments ago, Fed Chair Yellen delivered some opening remarks at a Fed conference in Washington, D.C., although her remarks did not touch on the economy or monetary policy.
The touch point for the market today, then, remains the health care reform vote. Stay tuned, because the outcome of that vote promises to be a market driver for better or for worse.