Wall Street to open up on econ hopes, retailers weigh
Wall Street was set up for a positive start on Thursday after an uptick in jobless claims failed to derail sentiment following surprisingly strong data on jobs creation in the last session.
But gains were capped as several top U.S. retailers missed Wall Street expectations for December sales as a post-Christmas blizzard slowed a two-month shopping spree. The Select Sector S&P SPDR Retail ETF
New claims for unemployment benefits rose more than expected last week, but a drop in the four-week average to a nearly 2-1/2 year low indicated a labor market improvement remained intact. Economists have raised forecasts for the widely followed government payrolls numbers due Friday.
Claims today are overshadowed by the large surprise from the ADP report yesterday, said Zach Pandl, economist at Nomura Securities International Inc in New York.
Markets in our view are looking for a very strong confirmation of the labor market rebound. We think tomorrow is going to be supportive of an ongoing recovery and greater momentum in general in the economy.
S&P 500 futures rose 1.7 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 34 points and Nasdaq 100 futures added 3.25 points.
After hitting a high near 1,278 on Wednesday and on the heels of better economic data, the S&P 500 faces resistance in the 1,300-1,325 area according to Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont. The S&P closed at 1,276.56 on Wednesday.
In a note Wednesday, Citigroup said it expected 2011 to be a year of strong but uneven global growth and upgraded U.S. equities to neutral.
U.S.-traded shares of BP Plc
The surge in new private-sector jobs, nearly three times the forecast, turned Wall Street's morning losses into gains on Wednesday, with financial shares leading the way.
(Reporting by Rodrigo Campos; editing by Jeffrey Benkoe)
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