Stock futures climb after four-day drop, data on tap
Stock index futures rose on Thursday, indicating the S&P 500 may halt a four-day slide ahead of data that is expected to show a rise in unemployment benefits claims.
The benchmark S&P 500 index has shed 2 percent over the past four sessions, its biggest four-day drop since late July, amid concern about the impact of slowing world growth on corporate profits.
Weak global demand has heightened investor worry over the corporate earnings season. As a group, S&P 500 companies' third-quarter earnings are expected to fall 2.9 percent from a year ago, according to Thomson Reuters data. It would be the first decline in three years.
"For the most part, companies will meet estimates and that is not going to be a surprise, but what we are going to see is companies lowering estimates going forward, in other words, murky forecasts. That is what is behind the pullback," said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.
The S&P 500 rose 2.4 percent in September, with gains largely fueled by central banks' stimulus policies. The index has dropped 0.6 percent thus far for October as investors' focus has shifted back to stock fundamentals.
Investors will examine weekly initial jobless claims data at 8:30 a.m. (1230 GMT) for any signs of improvement in the labor market after the unemployment rate fell to 7.8 percent in September. Economists in a Reuters survey forecast a total of 370,000 new filings compared with 367,000 in the prior week.
Other data also due at 8:30 a.m. include import-export prices for September and August international trade. Analysts in a Reuters poll expect an August trade deficit of $44.0 billion versus a deficit of $42.0 billion in July while imports are expected to rise 0.7 percent and exports by 0.4 percent.
S&P 500 futures rose 4.1 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures gained 32 points, and Nasdaq 100 futures added 13 points.
Sprint Nextel Corp shares jumped 12.7 percent to $5.68 in premarket trade after a source familiar with the matter told Reuters Softbank Corp <9984.T>, Japan's third-largest mobile carrier, is in talks to acquire a majority stake in the No. 3 wireless carrier in the United States.
Winnebago Industries Inc reported a higher quarterly profit and strong growth in its order backlog as demand for its motor homes grew.
Major retail stocks led European shares higher after three days of losses, although traders said a rating cut for Spain could push markets down to the tight trading range seen in the last month.
Standard & Poor's cut Spain's sovereign credit rating on Wednesday to BBB-minus, just above junk territory, citing a deepening economic recession that is limiting the government's policy options to arrest the slide.
Asian shares were lower as weak forecasts from U.S. corporate bellwethers underscored concern over global demand, particularly from China.
(Editing by Kenneth Barry)