- Pre-Market Indications

Thursday, September 9, 2010

Indications: U.S. stock futures climb on drop in jobless claims

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By Polya Lesova and Kate Gibson, MarketWatch

NEW YORK (MarketWatch) -- U.S. stock-index futures pointed to opening gains Thursday, with the Dow Jones Industrial Average poised to resume gains for the year after the government said that U.S. jobless claims fell last week.

Stock futures added to a mild advance after the Labor Department reported applications for unemployment benefits fell by 27,000 to 451,000 last week. Read more about jobless claims.

"The drop in jobless claims was meaningfully better than expected, as the weekly figure pulled back further from the psychologically challenging threshold of 500,000 that was reached two weeks ago," noted Jim Baird, chief investment strategist at Plante Moran Financial Advisors.

Futures on the Dow industrials gained 55 points to 10,444, and S&P 500 futures rose 7 points to 1,106.2. Nasdaq 100 futures added 12.5 points to 1,890.

Separately, the Commerce Department reported the U.S. trade deficit narrowed in July, as imports dropped and exports neared two-year highs.

The blue-chip Dow index /quotes/comstock/10w!i:dji/delayed (DJIA 10,451, +64.03, +0.62%) rose 0.5% Wednesday, as gains were limited by the Federal Reserve's confirmation that the American economy is slowing.

In its Beige Book report, the Fed said U.S. growth slowed over the summer, with some sectors, such as agriculture and manufacturing, holding up better than others. The biggest weaknesses were in real estate and construction. Read more about the Beige Book.

"The overall tone of the Beige Book was not too dissimilar to the economic data we've witnessed over the past month or so," said Jim Reid, strategist at Deutsche Bank.

U.S. officials meet Chinese president

Chinese President Hu Jintao met with top White House officials in a bid to smooth tensions between the two countries. Video courtesy of Reuters.

In Paris, Pier Carlo Padoan, chief economist at the Organization for Economic Cooperation and Development, said that the slowdown in the global economic recovery is "somewhat more pronounced than previously anticipated."

Bank of England stays on hold

The Bank of England left its key lending rate unchanged at a record low 0.5% and maintained its 200 billion pound ($309 billion) asset-purchase program on pause. Both moves were widely expected. Read more about the Bank of England.

Also in London, the U.K.'s financial-services watchdog said it has fined Goldman Sachs Group Inc. /quotes/comstock/13*!gs/quotes/nls/gs (GS 149.93, +2.39, +1.62%) 17.5 million pounds ($27 million) for failing to disclose a U.S. fraud probe that encompassed the firm's British operations. See more on Goldman fine.

European stocks posted gains, with the Stoxx Europe 600 index /quotes/comstock/22c!sxxp (ST:SXXP 264.73, +2.40, +0.91%) rising 0.5% in afternoon trading. Ireland's government successfully conducted a bond auction.


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Shares of Barry Callebaut AG /quotes/comstock/22a!barn (CH:BARN 746.00, +42.50, +6.04%) rallied after the Swiss firm said it will become the key global cocoa and industrial chocolate supplier to U.S. food giant Kraft Foods Inc. /quotes/comstock/13*!kft/quotes/nls/kft (KFT 30.56, -0.02, -0.07%) . The deal is expected to more than double Barry Callebaut's existing business with Kraft. See more on Barry Callebaut.

U.S.-listed shares of ARM Holdings /quotes/comstock/15*!armh/quotes/nls/armh (ARMH 18.65, +0.56, +3.08%) /quotes/comstock/23s!a:arm (UK:ARM 403.20, +15.50, +4.00%) gained in premarket trading after the firm unveiled a new high-end core processor.

Shares of Fuqi International Inc. /quotes/comstock/15*!fuqi/quotes/nls/fuqi (FUQI 4.85, -1.50, -23.62%) tumbled in U.S. premarket trading. The Chinese jewelry company disclosed that the U.S. Securities and Exchange Commission has started a formal investigation into the firm. Fuqi said it has received a subpoena from the SEC for certain documents, relating to its failure to timely file required periodic reports.

Most Asian equity markets ended higher overnight, though China was a notable exception, with the Shanghai Composite stock index dropping 1.4%.

In the commodity markets, crude-oil futures gained 47 cents to $75.14 a barrel in electronic trading on Globex ahead of government data on U.S. petroleum supplies.

Gold futures dropped $3.30 to $1,254.2 an ounce.

The dollar index /quotes/comstock/11j!i:dxy0 (DXY 82.62, +0.03, +0.04%) , which tracks the performance of the greenback against a basket of other major currencies, edged lower to 82.549.

Polya Lesova is MarketWatch's London bureau chief. Kate Gibson is a reporter for MarketWatch, based in New York.

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