U.S. stock index futures erased most of their gains Thursday after jobless claims jumped more than expected, but aggressive moves by the Japanese central bank helped limit losses.
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Weekly jobless claims popped 28,000 last week to a seasonally adjusted 385,000, hitting its highest level in four months, according to the Labor Department. It was the third straight week of gains in claims. Economists polled by Reuters had expected first-time applications last week to fall to 350,000.
Earlier, outplacement firm Challenger, Gray & Christmas said layoffs surged 30 percent in the first quarter from a year ago, even though March furlough activity declined. It was more bad news for the job market, which appears to be slowing after gaining some momentum in late 2012.
The data come ahead of the widely-followed government non-farm payrolls report, due Friday. Economists expect to see a gain of 200,000, with the unemployment rate steady at 7.7 percent, according to a Reuters poll.
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Meanwhile, the Bank of Japan surprised the market with an overhaul of its monetary policy, adopting a new balance sheet target and pledging to double its government bond holdings in two years. The Nikkei soared more than 2 percent to close at its best level in more than four years.
"This is the muscular, aggressive BOJ the market has been looking for… I think this was very much what was expected and I think it is welcomed by the markets, both equities and fixed income alike," said James Ashley, senior economist at RBC Capital Markets.