Futures Turn Higher After Housing News

Futures turned higher Thursday following a better-than-expected housing news. Futures were pressured earlier on the heels of heightened fears that the Greek debt crisis will deteriorate further and ahead of a handful of U.S. economic news.

Housing starts rose more than expected and permits for future construction touched a five month high in May, according to the Commerce Department, but any recovery will be hampered by a glut of pre-owned homes.

On the economic front, new applications for jobless benefits fell to 414,000 in the latest weekfrom an upwardly revised 430,000 in the week before. Economists polled by Reuters had been looking for a smaller decline to 420,000.

Housing starts rose 3.5 percent to a seasonally adjusted annual rate of 560,000 units, retracing almost half of Aprils steep decline. Aprils starts were revised up to a 541,000 unit pace, which was previously reported as a 523,000 unit rate. Economists in a Reuters survey forecast a rise to a 540,000 annualized rate from 523,000 in April, and a total of 558,000 permits in May compared with 563,000 in April.

After violent protests in Athens Wednesday, Greek Prime Minister George Papandreou said he would reshuffle the government and would seek a confidence vote in parliament.

Meanwhile, there was some chatter that China may provide some sort of European bailout.

Also on the economic front, the U.S. current account deficit increased to $119.3 billion in the first quarter on strong imports, reported the Commerce Department. The deficit—which measures the flow of goods, services and investments in and out of the U.S.—represented 3.2 percent of U.S. gross domestic product, up from 3.0 percent in the fourth quarter.

The current account gap amounted to $112.2 billion in the fourth quarter. Economists had been looking for the deficit to widen to $126.0 billion in the first quarter.

The Philadelphia Fed survey will be out at 10 am ET, with economists expecting a reading of 6.8 versus 3.9 in May.

And in banking news, Citigroup said the hacker attack that breached some of its credit card data affected 360,000 customers, about twice as many as it had originally estimated.

Hewlett-Packard sued rival Oracle to force the world's No. 3 software maker to reverse its decision to discontinue the development on Intel's Itanium microprocessor.

On the earnings front, food producer Smithfield Foods gained after the nation's largest pork producer reported a better-than-expected profit on higher prices at its two key units, hog production and pork processing.

Finisar sank after the network equipment maker forecast a dismal first quarter, hurt by a continued slowdown in demand from Chinese telecom equipment makers. Rivals JDSU and Ciena also tumbled following the news.

Research In Motion is slated to report earnings after-the-bell.

Southern Union soared after it agreed to be acquired by rival Energy Transfer Equity for about $4.11 billion to create one of the largest U.S. natural gas pipeline operators.

European shares fell to head for their seventh consecutive weekly drop as worries about Greek's debt troubles worsened and investors feared contagion, reflected in Spain's debt auction.

On Tap This Week:

THURSDAY: Housing sales, jobless claims, current account, Philadelphia Fed survey, Fed's Fisher speaks, money supply; Earnings from Research In Motion
FRIDAY: Consumer sentiment, leading indicators, quadruple witching

More on CNBC.com