Wall Street to open lower as crude slips; jobs data eyed

By Yashaswini Swamynathan

REUTERS - U.S. stocks were set to open slightly lower on Thursday as crude prices fell below $50 and investors stayed cautious ahead of Friday's jobs data that could cement the chances of an interest rate hike next week.

U.S. crude prices were off 1.7 percent after hitting a four-month low of $48.79 following a record rise in inventories. Shares of Exxon Mobil and Chevron were off about 1 percent in premarket trading. They closed down nearly 2 percent on Wednesday. [O/R]

The European Central Bank kept its policy stance unchanged and remained dovish on its outlook ahead of key elections in France and the Netherlands and a surge in inflation that could be temporary.

Futures pulled back slightly after the ECB decision, but investors are squarely focused on Friday's U.S. nonfarm payrolls report, which is expected to feed into Federal Reserve's decision on an interest rate hike at its meeting on March 14-15.

"I think we are headed for another defensive day, based on climbing yields, falling oil prices and tomorrow's employment number, which will be another confirmation that the Fed may be more aggressive in raising rates than previously expected," said Peter Cardillo, chief market economist at First Standard Financial in New York.

Worries over Wall Street valuations and the nearly 90 percent odds of a rate increase have put the brakes on a post-election rally in recent days.

The S&P 500 has closed lower for the past three days, setting it up for the first weekly decline in seven weeks.

"The market is priced to perfection, so any disappointment is not going to be well received," Cardillo said.

The S&P is trading at about 18 times forward earnings estimates against the long-term average of about 15 times, according to Thomson Reuters data.

Dow e-minis were down 24 points, or 0.12 percent at 8:32 a.m. ET (1332 GMT), with 24,954 contracts changing hands.

S&P 500 e-minis were down 3 points, or 0.13 percent, with 186,304 contracts traded.

Nasdaq 100 e-minis were down 5.5 points, or 0.1 percent, on volume of 25,689 contracts.

A Labor Department report on Thursday showed the number of Americans applying for unemployment benefits rose to 243,000 last week, but remained below 300,000 for the 105th week, pointing to a healthy labor market.

Among stocks, American International Group was up 1.9 percent at $64.65 premarket after Chief Executive Officer Peter Hancock said he would resign.

e.l.f Beauty jumped nearly 22 percent to $30.75 following the cosmetics maker's better-than-expected quarterly revenue.

Tailored Brands tumbled 31 percent to $16.20 after the Jos. A. Bank brand's owner reported a bigger-than-expected loss in the fourth quarter.

(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Sriraj Kalluvila)