Stocks could continue to tilt higher Thursday, as traders focus on U.S. jobless claims data and productivity and labor costs ahead of the October jobs report.
Friday's employment report is expected to show 231,000 nonfarm payrolls were added in October, and that fits with ADP's 230,000 private sector payrolls reported in its Wednesday release. Good jobs growth was also confirmed in the ISM nonmanufacturing survey's employment index Wednesday, which rose to 59.6—a nine-year high.
"The stars are aligned for a 230,000 print for nonfarm suggested by these various data points. That's the sentiment going into Friday's report. If you get a claims number of 285,000 or so, that's what's expected," said Adrian Miller, director of fixed-income strategy at GMP Securities.
The claims and productivity and costs data are released at 8:30 a.m. EST, and Miller says he's watching to see if the labor costs meet expectations of a 0.5 percent increase, confirming an increase in the employment cost index last quarter.
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Another important influence on financial markets could be the European Central Bank's rate meeting. It is not expected to take any action there, but comments from ECB President Mario Draghi will be important. The ECB could add some new details to attract more banks in December to its longer term refinancing operations, as it failed to spur much activity in September, Miller said.
Traders are hoping the ECB will undertake a bigger quantitative easing-like program. "There's a lot on the table, and I think there's just too much turmoil within the ECB to push through QE even if he (Draghi) wanted to, and there hasn't been enough data since the September meeting to push them," said David Gilmore, market strategist at FX Analytics. "I think they're behind the curve."
Watch: Santelli Exchange: ECB in tight spot
Gilmore said he expects the stock market to continue its post-election advance. Both the Dow, up 100 points at 17,484, and the , up 11 points at 2,023, closed at record highs Wednesday. The Nasdaq was off 2 points at 4,620.
"I think we're in a pretty favorable stock market environment with the election results," he said. "You have to be bullish on stocks and it's ahead of payroll number which ADP suggest is going to be in line with the average. You've got to be long in there and don't be panicked by crazy days like you saw in October," Gilmore said.
He expects the dollar strength to continue. "The dollar's experiencing an old-fashioned rally…In general, the dollar's been rallying against most currencies. It's something to behold. We don't see it very often so you have to sort of enjoy it while you have it. We're going to see more of it into the end of the year because I think there's enough momentum in the U.S. economy to look stellar against the rest of the world," he said.
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The dollar surged to a seven-year high against the yen.
Miller, too, said the dollar could continue gain. "Probably the only things affected by the election were the dollar and health care shares. The fallout from the dollar was gold," he said. Gold was off more than 2 percent at $1,145 per ounce, and is now down 6.5 percent in the last five trading days.
Energy shares were higher with higher oil prices Wednesday. WTI crude climbed 1.9 percent to $78.68 per barrel after a lower than expected build in U.S. inventories. It also got a temporary pop on speculation smoke at an Aramco pipeline in Saudi Arabia was the work of terrorists. News wires quoted a source saying it was not a terrorist event and the company had been working on the line.
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There are also two Fed speakers Thursday—Chicago Fed President Charles Evans speaks at 10:40 am EST at a banking conference and Cleveland Fed President Loretta Mester speaks at 7:05 p.m. to the New York Money Marketeers on Federal Reserve communications and forward guidance.
Monthly chain-store sales are also expected in the morning. Thomson Reuters says the mean forecast for the retailers in its index is 3.5 percent. Drugstores are expected to have a 4.8 percent sales increase.
Earnings are expected from AstraZeneca, Siemens, Apache, Calpine, Molson Coors Brewing, BioCryst Pharma, Cablevision, AMC Networks, AOL, Wendy's, Kate Spade, Orbitz and Generac, ahead of the opening bell. After the close, Disney, First Solar, Computer Sciences, Lionsgate, and Zynga report.