Stock Futures Up; Jobless Claims Down

NEW YORK ( TheStreet) -- Stock futures were rising Thursday following data showing a deeper than expected decline in initial jobless claims last week.

Futures for the Dow Jones Industrial Average were rising 32 points, or 23.4 points above fair value, at 13,236. Futures for the S&P 500 were up 3.7 points, or 2.8 points above fair value, at 1401, and futures for the Nasdaq were up 8.3 points, or 5.1 points above fair value, at 2736.

On Thursday, the Labor Department said that the advance figure for seasonally adjusted initial jobless claims for last week fell 27,000 to 365,000, from an upwardly-revised 392,000 the prior week. It was the largest weekly drop since early May 2011.

"This drop reinforces the view that the recent rise was more a function of seasonality than underlying deterioration in labor conditions," said Eric Green, chief economist at TD Securities, after the report.

The four-week moving average increased 750 to 383,500. Economists surveyed by Thomson Reuters were expecting claims to tick down to 380,000 in the week ended April 28 from the previous estimate of 388,000 for the prior week.

Continuing claims fell 53,000 to a seasonally adjusted 3.28 million in the week ended April 21.

Thursday's data on jobs precedes the much-anticipated April nonfarm payrolls report from the Labor Department on Friday, which greatly disappointed last month. The economy added only 120,000 jobs in March, about half the gains posted in each of the previous three months. Economists currently expect a gain of 170,000 for April.

The Institute for Supply Management's non-manufacturing index measuring the service industries will be released at 10 a.m. ET Economists estimate the index decelerated to 55.5 in April from 56 in March. Any reading above 50 implies expansion.

It was a mixed finish for stocks Wednesday as investors pondered a disappointing private-sector employment report ahead of Friday's official April jobs data.

In Europe, London's FTSE was rising 0.6% and the DAX in Germany was up 1.2% following a round of solid earnings reports in Europe and ahead of the results of a European Central Bank meeting in Barcelona. The markets will watch for signs from European Central Bank President Mario Draghi of further stimulus measures to help improve the continent's debt situation.

Ahead of the meeting, Spain raised €2.52 billion ($3.3 billion) in three- and five-year bonds, just above the top end of its targeted range of €1.5 billion to €2.5 billion. But borrowing costs at the auction rose given the deep concerns about the Spanish economy.

The Hang Seng Index in Hong Kong shed 0.3%. The Japanese market is closed Thursday and Friday for national holidays.

In corporate news, Dow component Kraft Foods ( KFT) is scheduled to report its first-quarter results after Thursday's closing bell. Analysts are calling for earnings of 56 cents a share on revenue of $13.05 billion.

Kraft is splitting into two separate publicly traded entities -- a North American grocery products company that will retain the Kraft Foods name and a global snack foods company to be called Mondelez International.

Costco Wholesale ( COST), the warehouse retailer, said Thursday that comparable-store sales in April rose 4%. Total sales rose 7% to $7.25 billion.

Kensey Nash ( KNSY), a medical-devices company, agreed to be acquired by Dutch high-performance materials maker Royal DSM for $38.50 a share. The cash bid, which has been approved by the Kensey Nash board, is a 33% premium to Kensey Nash's closing price of $29.01 on Wednesday.

Shares of Green Mountain Coffee Roasters ( GMCR) were being crushed in pre-market action after the company reported a revenue shortfall in its fiscal second quarter and provided an outlook for fiscal 2012 that was well below analysts' expectations.

Green Mountain said it sees non-GAAP earnings of $2.40 to $2.50 a share; analysts forecast profit of $2.67 a share.

In commodity markets, the June crude oil contract was off 38 cents to trade at $104.84 a barrel. June gold futures were down by $9.40 to $1,644.60 an ounce.

The benchmark 10-year Treasury was off by 1/32, lifting the yield to 1.9%. The dollar was up 0.2%, according to the dollar index.

-- Written by Andrea Tse in New York.

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