Futures Slide After Jump in Jobless Claims

Stock futures added to losses after news of an unexpected jump in jobless claims, while nonfarm productivity growth slowed in the first quarter.

Initial claims for unemployment rose 43,000 to 474,000 from an upwardly revised 431,000 the week before, the Labor Department reported Thursday. Economists surveyed by Reuters had expected claims to drop to 410,000.

Claims are at the highest level since mid-August. The four-week moving average of unemployment claims rose by 22,250 to 431,250, the highest since November.

The news comes a day after a report showed a slowdown in the pace of private payroll growth and a decline in job cuts.

The closely-watched monthly nonfarm payroll report from the government for April will be reported on Friday. Economists expect the nation added 186,000 jobs.

Nonfarm productivity in the first quarter, meanwhile, rose at a 1.6 percent annual rate, down from a 2.9 percent pace in the fourth quarter, the Labor Department also reported.

The European Central Bank kept rates at 1.25 percent on Thursday, and President Jean-Claude Trichet suggested at a news conference that a rate rise wasn't likely next month but could happen in July, Reuters reported. (Watch a stream of the press conference live on CNBC.com)

"We will continue to monitor very closely all developments," with respect to price stability, Trichet said.

According to analysts, the use of the phrase "monitor very closely" upside risks to price stability, would signal a rate rise in July, while the phrase "strong vigilance" would signal a rise in June.

The dollar gained against a basket of currencies on the news, while the euro sank.

And oil pricessharply fell amid concern about a reduction in demand and rising interest rates. London Brent crudefell more than 3 percent to nearly $117, while U.S. light crude fell nearly 3 percent to nearly $106.

In earnings news, General Motors traded flat to slightly lower despite beating both profit and revenue expectations. The once bankrupt automaker credited sales in North America and Asia for the gains.

CVS Caremark was slightly lower despite reporting a higher-than-expected profit for the quarter, driven by pharmacy services sales.

News Corp slumped Thursday morning after delivering results Wednesday after the market closed that missed expectations.

But Whole Foods Market jumped after beating expectations.

Cisco traded flat after news the company is streamlining its sales, services and engineering operations.

Federal Reserve Chairman Ben Bernanke speaks at 9:30 a.m. at a Chicago Fed conference on bank structure and competition. Chicago Fed President Charles Evans makes opening remarks just ahead of him, at the same event.

European shares were lower in morning trade, led down by banks.

On Tap This Week:

THURSDAY: Treasury STRIPS, money supply; Fed Chairman Bernanke speaks, Fed's Kocherlakota speaks, UPS shareholder meeting, Verizon shareholder meeting; earnings after-the-bell from AIG, Kraft and Visa.
FRIDAY: Non-farm payroll report, consumer credit, Alcoa shareholder meeting, flash crash anniversary; earnings before-the-bell from Constellation Energy and tentatively after-the-bell from Berkshire Hathaway.

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