Wall Street was set for a gain of more than 1 percent on Thursday as better-than-expected company profits in the first quarter and a surprise total of new jobless claims stoked optimism the recession is showing signs of easing.
Among the bright spots, Dow Chemical Co
The number of workers filing new claims for jobless aid last week were fewer than forecast, but continued claims racked up a new fresh record high, showing the continued impact of the sharp slowdown on the labor market.
The bottom line is that the trend continues to be a stabilization in the level of firing, as the initial claims level hasn't busted above the 600 range, though the level of continuing claims continues to rise, said Peter Boockvar, equity strategist at Miller Tabak & Co in New York.
There are signs that the data isn't getting worse. The next six months will likely look better than the last six months, and that will help the labor market.
S&P 500 futures rose 13.30 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures climbed 108 points, and Nasdaq 100 futures added 18.75 points.
Optimism extended from the previous session after the Federal Reserve said Wednesday the economic outlook had improved modestly since its last meeting in March. The comments helped stocks close higher.
Oil giant Exxon Mobil Corp's
Shares in Bank of America Corp
In the auto sector, Chrysler LLC rushed to secure deals in a last-minute attempt to avoid bankruptcy ahead of a government-imposed midnight restructuring deadline.
Chrysler, the third-largest U.S. automaker, still has not gained the bondholder support it needs to avoid the first-ever bankruptcy filing for a Detroit Three automaker.
Worries over the economic implications of spreading swine flu could hamper the market after Mexican President Felipe Calderon urged people to stay home from Friday for a five-day partial shutdown of the economy, after the World Health Organization said a swine flu pandemic was imminent.
Dow component Procter & Gamble Co
In the same sector, Colgate-Palmolive Co
Cellphone maker Motorola Inc
A reading from the Chicago Institute of Supply Management on manufacturing activity is expected later in the morning.
(Reporting by Leah Schnurr; additional reporting by Ryan Vlastelica; editing by Jeffrey Benkoe)