By Tomi Kilgore
U.S. stock futures wavered to start the month, a day after the Dow Jones Industrial Average rose to its first record close of 2014.
With most of Europe closed for the May Day holiday, trading was expected to be relatively muted in the early going.
About 90 minutes ahead of the open, Dow futures eased four points, or less than 0.1%, to 16507. On Wednesday, the Dow rose 45 points, or 0.3%, to close at a record high and in positive territory for the year. The Federal Reserve said Wednesday it would continue to reduce its bond purchases, pointing to improving economic growth following a slow winter.
On Thursday, S&P 500 index futures were virtually flat at 1878 and Nasdaq-100 futures ticked up seven points, or 0.2%, to 3580. Changes in stock futures don't always accurately predict stock moves after the opening bell.
The S&P 500 closed Wednesday within 0.4% of its April 2 record closing high of 1890.90. The index posted its third-straight monthly gain in April, and the seventh gain in eight months.
The tech-heavy Nasdaq Composite Index declined for two straight months for the first time since May 2012, highlighting the recent weakness in the biotechnology and consumer Internet sectors.
The outlook for corporate earnings continues to improve, underpinning the broader market's gains. With 65% of the S&P 500 having reported first-quarter results, overall earnings per share are now seen rising 1% from year-ago levels, according to FactSet, versus expectations of a 1.2% decline at the end of March. Revenue is seen growing 2.6% from last year, according to FactSet.
"What we're seeing is the Fed is agreeing with what the market is showing: the economy is relatively healthy and the earnings season confirms this as well," said Chris Hobart, chief executive of Hobart Financial Group, which has over $300 million in assets under management. "Earnings expectations were set lower than typical, and they haven't been horrific."
At 8:30 a.m. Eastern, initial claims for jobless benefits in the latest week are expected to decline to 320,000 from 329,000 the week before.
At the same time, personal income for March is seen rising 0.4% on the month, consumer spending is forecast to increase 0.6% and personal consumption expenditures are expected to be up 0.2%.
After the open, the Institute for Supply Management's manufacturing purchasing managers index for April is seen rising to 54.3 from 53.7 in March, while construction spending for March is expected to increase 0.5%.
But investors will be looking ahead to the government's monthly employment report on Friday.
The yield on the 10-year Treasury note edged higher to 2.663% from 2.647% late Wednesday.
Among early stock movers, Yelp surged 9.3% in premarket trading after reporting late Wednesday a narrower-than-expected first-quarter loss and lifting its full-year revenue outlook.
DirecTV climbed 7.5% after The Wall Street Journal reported the satellite-TV company was approached by AT&T about a possible acquisition in a deal that would likely be worth at least $40 billion. Dow component AT&T slipped 1%.
Gold futures fell 0.9% to $1,283.80 an ounce, on track to extend their losing streak to four sessions. Crude-oil futures lost 0.6% to $99.15 a barrel, after suffering in April the biggest monthly decline since November 2013.
The U.K. stock market, which was one of the few European markets open Thursday, rose after a better-than-expected reading on manufacturing activity in April. The U.K.'s FTSE 100 index rose 0.3%, helping lift the Stoxx Europe 600 up 0.1%.
Most Asian markets were closed for Labor Day. Of the few markets open, Japan's Nikkei Stock Average rallied 1.3% following solid corporate earnings reports.
In other corporate news, Weight Watchers rallied 13% after the company's reported late Wednesday first-quarter adjusted earnings that were well above analyst estimates and lifted its full-year outlook.
ConocoPhillips tacked on 1.6% after first-quarter adjusted earnings and revenue rose more than expected, boosted by higher average selling prices for natural gas and increased production.
MetLife fell 2.6% after the life insurer reported late Wednesday disappointing first-quarter operating earnings and revenue.
Write to Tomi Kilgore at firstname.lastname@example.org