By Barbara Kollmeyer, MarketWatch
MADRID (MarketWatch) -- U.S. stock futures pointed to gains at
the start of trading on Thursday, boosted by news of more stimulus
out of China, as investors awaited an update on housing starts and
weekly jobless claims.
Coming from a flat position ahead of that stimulus news, futures
for the Dow Jones Industrial Average rose 51 points, or 0.3%, to
17,122, while those for the S&P 500 index (SPZ4) added 7 points
to 2,000.70. Futures for the Nasdaq-100 index (NDZ4) ticked up
11.75 points to 4,077.50.
China's central bank cut short-term borrowing costs for banks on
Thursday, in the same week it announced an injection of cash into
the country's five biggest banks. For markets, this is a "massive
statement of intent," said Craig Erlam, market analyst at Alpari,
in emailed comments. A string of weak data out of China has
heightened concerns about that global growth engine.
"We know this has worked in the past, so there is no reason to
believe it won't work again, and the markets love it," Erlam
said.
Federal Reserve Chairwoman Janet Yellen will speak on asset
building for low- and middle-income households via prerecorded
video at 8:45 a.m. Eastern Time.
In the U.S., economists expect the pace of home construction to
pull back in August from July, which had the highest reading since
late 2013. Those numbers are due at 8:30 a.m. Eastern Time, along
with weekly jobless claims, which are expected to dip from the
previous week.
At 10 a.m. Eastern Time, the Federal Reserve Bank of
Philadelphia will publish its September monthly reading on regional
manufacturers, which is expected to weaken from August.
The Dow industrials (DJI) notched a record high on Wednesday,
though stocks flattened by the end of the session. The Federal Open
Market Committee stuck to its view that it will keep short-term
interest rates near zero for a "considerable time" after the
central bank stops its big-scale purchases of bonds. Read: Fed will
be quick about raising rates, once it starts
Credit Suisse on Wednesday became the latest Wall Street bank to
lift its S&P 500 forecasts for year-end, but also predicted a
correction for next year.
Stocks to watch: United Natural Foods Inc. (UNFI) could gain
after a late-session rise on earnings and an outlook that topped
Wall Street's forecast. See After Hours roundup
Pier 1 Imports Inc. (PIR) could add to a 10% late-session drop,
after earnings fell short of hopes and the company cut its forecast
for the year.
Flexion Therapeutics Inc. (FLXN) fell 27% late Wednesday after
the Food and Drug Administration placed a hold on a mid-stage
clinical trial on the company's treatment for osteoarthritis of the
knee.
Other markets: Stocks in London rose as Scottish voters headed
to the polls, with indications still pointing to a narrow victory
for those wishing to stay in the union. U.K retail sales rose at a
faster pace in August, but were driven by gasoline prices,
suggesting inflationary pressures remain weak and putting less
pressure on the Bank of England to hike rates.
Stock futures and European stocks rose across the board after
news of a second surprise move this week to ease monetary policy by
China's central bank, which cut short-term borrowing costs for
banks on Thursday. Japanese stocks climbed to an eight-month
closing high, as the yen(USDJPY) hit a six-year low against the
greenback, aiding export-related stocks.
The euro (EURUSD) held steady after the European Central Bank
allotted 82.6 billion euros in the first round of its new four-year
loans. Forecasters were expecting a higher take-up. Gold prices
(GCZ4) fell 1%, pressured by a strong dollar.
Subscribe to WSJ: http://online.wsj.com?mod=djnwires