© Reuters. FILE PHOTO: A Wall Street sign is pictured outside the New York Stock Exchange, in New York City
© Reuters. FILE PHOTO: A Wall Street sign is pictured outside the New York Stock Exchange, in New York City

By Medha Singh

(Reuters) – U.S. stock index futures dropped on Thursday as investors braced for weekly jobless claims, which could compound fears of a stalling economic recovery a day after Treasury Secretary Steven Mnuchin dashed hopes for more fiscal aid before the election.

The Labor Department’s data is expected to show the number of Americans filing for state unemployment benefits eased to 825,000 last week from 840,000, but still remain at a high level as the labor market struggled to recover from the damage inflicted by the COVID-19 pandemic.

Hopes of another round of fiscal aid to support the U.S. economy’s recovery helped fuel Wall Street’s recent rally, bringing the S&P 500 and Nasdaq earlier this week to within 2% of their record closing highs from Sept. 2.

Focus is also on corporate America where expectations for third-quarter earnings have improved to a 18.9% drop from a 25.0% tumble forecast on July 1, according to Refinitiv IBES data.

Morgan Stanley (N:) fell 0.8% in premarket trading ahead of its results which would wrap up earnings from major Wall Street lenders. Other companies scheduled to report are Honeywell International Inc (N:), Charles Schwab Corp (N:) and Walgreens Boot Alliance Inc (N:).

At 6:19 a.m. ET, 1YMcv1> were down 280 points, or 0.99% and S&P 500 e-minis were down 37.75 points, or 1.08%.

were down 191 points, or 1.6%, as tech heavyweights such as Apple Inc (O:), Microsoft Corp (O:) and Amazon.com Inc (O:) shed between 1.6% and 2.5%.

Shares of drug developer Vertex Pharmaceuticals Inc (O:) sank 9.4% premarket after it discontinued its trial of a protein deficiency disorder treatment.

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