Stock index futures were poised for a higher open on Friday after the government's stress tests results on big banks lifted optimism on financial stocks and data showed employers cut a smaller-than-expected amount of jobs in April.
U.S. regulators told top banks after the close on Thursday to raise $74.6 billion to build a capital cushion that officials hope will restore faith in financial firms and set a course out of the deepest recession in decades.
The 539,000 job cuts by employers in April was the smallest reduction since October, and hinted at some improvement in the labor market, but the unemployment rate soared to 8.9 percent, the highest since September 1983.
The losses were less than consensus and the stress test also went reasonably well, said Subodh Kumar, Chief Investment Strategist at Subodh Kumar & Associates in Toronto.
The data may be a trend in that many companies cut their costs in an unprecedented way in the fourth quarter and in the first quarter. That cost cutting will abate as many companies have stabilized their cost structure.
Shares of several major banks rose, with Citigroup Inc
Bank of America Chief Executive Kenneth Lewis said in an interview on CNBC that he anticipates about $10 billion in asset sales and that he is pretty confident the bank will do better than the stress test results indicate.
S&P 500 futures rose 11 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 added 66 points, and Nasdaq 100 futures gained 10 points.
Toyota Motor Corp <7203.T>, the world's biggest automaker, forecast a much bigger-than-expected annual loss and said it would sell about 1 million fewer vehicles this year, forcing it to contemplate cost cuts in a severe market downturn.
U.S.-traded shares of the automaker fell 2.8 percent to $78 in premarket trade.
Oil rose to $58 a barrel, its highest level in about 6 months, lifted by hopes of an economic recovery that could boost world oil demand.
U.S. stocks slid on Thursday as investors took profits from the technology sector's recent surge, while analyst downgrades hurt telecoms and a tepid response to a government bond auction raised fears about public finances.
Since hitting a 12-year closing low in March, the S&P has surged 34 percent, driven by optimism about the financial systems's condition and hopes the recession may be waning.
(Reporting by Chuck Mikolajczak, additional reporting by Ryan Vlastelica; Editing by Padraic Cassidy)