NEW YORK (AP) - Investors were ready to give up some of their gains Thursday ahead of a key reading on unemployment and a day after a rally driven by the Federal Reserve’s announcement that it would pump more than $1 trillion into the economy. Wall Street pointed to a lower opening.
Investors are eagerly awaiting the latest in a string of reports on how the struggling economy is faring. Data is expected to show a slight dip in new workers filing for unemployment benefits. Initial jobless benefit claims are forecast to drop to a seasonally adjusted 652,000 from the previous week’s 654,000, according to economists polled by Thomson Reuters.
The Labor Department’s report is scheduled to be released Thursday at 8:30 a.m. EDT.
Ahead of the report, Dow Jones industrial average futures fell 33, or 0.44 percent, to 7,465. Standard & Poor’s 500 index futures declined 4.8, or 0.61 percent, to 786.80, while Nasdaq 100 index futures fell 9.75, or 0.80 percent, to 1,203.00.
Markets are coming off their sixth gain in the past seven trading sessions, buoyed by a string of upbeat news. The latest was the Fed’s announcement it would pump more than $1 trillion into the economy to help revive the battered housing market, which has been a primary reason for the ongoing economic turmoil. The plan includes buying up to $300 billion of long-term government bonds during the next six months, which sent the bond market surging Wednesday as well. The Fed’s moves are aimed at driving down borrowing costs for everything from mortgages to credit cards.
It was the second straight day signs of potential improvement for the housing market helped bolster the markets. On Tuesday, an unexpected increase in housing starts and building applications sent investors into the market. A recovery of the housing market is widely considered a key to helping ending the ongoing recession.
The recently rally was sparked by some of the hardest hit banks in the country announcing they have seen business improve during the first two months of the year, including Citigroup Inc. and Bank of America Corp.
Meanwhile, bond prices fell slightly, a day after steep gains following the Fed news. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 2.52 percent from 2.50 percent late Wednesday. The yield on the three-month T-bill, considered one of the safest investments, rose to 0.21 percent from 0.20 percent late Wednesday.
The dollar was mixed against other major currencies, while gold prices rose.
Oil prices rose $1.44 to $49.58 per barrel in premarket electronic trading on the New York Mercantile Exchange.
Overseas, Japan’s Nikkei stock average fell 0.3 percent. In afternoon trading, Britain’s FTSE 100 was rose 0.7 percent, Germany’s DAX index gained 1.2 percent, and France’s CAC-40 rose 0.9 percent.
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