Futures Rise After Jobless Claims, Fed Move
Stock index futures continued to point higher Thursday despite a spike in jobless claims, as markets digested the Federal Reserve's decision buy $600 billion more in government bondsto boost the economy and looked ahead to policy decisions from the Bank of England and the European Central Bank.
Also, early Thursday, the Bank of Englandand theEuropean Central Bank left their benchmark interest rates unchanged.
New U.S. claims for unemployment benefits rose 20,000to a seasonally adjusted 457,000, according to the Labor Department said, reversing a decline from last week when claims fell to a revised 437,000. Analysts had estimated claims would rise to 443,000, Reuters said.
Meanwhile, nonfarm productivity for the third quarter rose 1.9 percent, more than expected, while unit labor costs fell 0.1 percent, which was less than expected.
The Fed's decision to pump more money into the economy pressured the dollar Thursday. But Fed President Ben Bernanke said the central bank's efforts to stimulate the economy won't spark excess inflation, as some market participants have feared. In an op-ed article in the Washington Post, Bernanke said high unemployment, and excessively low inflation, were bigger worries.
Monthly retail sales figuresfor October were largely better-than-expected, although warm fall weather muted sales in some categories.
Earnings news continued on Thursday. Time Warner Cable's shares jumped after the cable provider reported its net income rose to $360 million or $1 a share, up from $268 million or 76 cents a share a year before. Meanwhile, Time Warner reported losing 155,000 video subscribers in the third quarter, more than double the number it lost a year earlier.
Investors were likely to keep an eye on BHP Billiton and Potash , as the Canadian government rejectedBHP's $39 billion dollar hostile takeover bid for Potash.
In Europe, consumer goods group Unilever reported a 3.6 percent rise in third-quarter sales but warned that higher commodity costs were putting pressure on its profit margins.
Deutsche Telekom reported sales growth driven by mobile data services.
On Tap Next Week:
THURSDAY: After-the-bell earnings from Kraft, Activision and Starbucks.
FRIDAY: Pending home sales index, non-farm payrolls report, consumer credit; Kansas City Fed President Hoenig speaks; before-the-bell earnings from Toyota; after-the-bell earnings from Berkshire Hathaway.
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