U.S. Stocks Rise Over Higher Consumer Spending, Lower Initial Jobless Claims

New York, NY (AHN) - U.S. stocks are set to open slightly higher on Thursday as a government report indicated that personal spending increased better-than-expected during the last quarter, offsetting negative sentiments in the markets.

Additional boost to the markets can come from the reports indicating a decline in the initial jobless claims and slightly higher GDP growth rate during last quarter.

Retailers and food industry shares increased on Thursday after the Commerce Department reported that consumer spending, which accounts for two-thirds of the economy, have increased by 2.3 percent during the fourth quarter at an annual rate.

On Thursday, at 9:56 a.m. Eastern Standard & Poor's was advancing by 0.15 points or 0.01 percent at 1,341.28 points in New York.

At the same time, the Dow Jones Industrial Average index was rising by 15.47 points or 0.12 percent at 12,438.33 points. While, NASDAQ index was climbing down by 18.08 points or 0.78 percent at 2,306.28 points.

The Commerce Department on Thursday also estimated that the U.S. economy will grow sluggishly higher by 0.6 percent annual rate during the fourth-quarter, compared to the GDP growth of 4.9 percent annual rate in the third quarter.

The current data indicate that the U.S. economy advanced at the weakest pace since late 2002, rising at an inflation-adjusted 2.2 percent rate.

Consumer prices have reportedly increased by 3.4 percent, while core prices climbed up by 2.1 percent in 2007.

Meanwhile, the Labor Department's report stated on Thursday that the initial jobless claims for insurance benefits dropped by 9,000 to 366,000 after seasonal adjustments during the week that ended on March 22.

In technology sector, Oracle, the business software giant, plunged as much as 8 percent in pre-open market after firm reported that its earnings increased but not more than the estimated rate at 21 percent as its quarterly profit gained by 30 percent.

In commodities, light, sweet crude oil futures for May delivery increased by $1.35 to $107.25 a barrel in electronic trading on Thursday. While, gold futures fell by $1.50 to $947.70 an ounce as mining sector in global markets experienced a downturn momentum due to rising raw-material prices.

Investors could react to the number of Federal Reserve officials' speeches scheduled on Thursday.

In global markets, European equities climbed on Thursday after positive news from a Swedish retailer posted higher earnings amid weak U.S. dollar as well as mining sector boosted up the shares.

And, Asian markets dropped on Thursday for the first time in five consecutive sessions as the equities in major markets like Japan fell amid renewed negative sentiments over the weakening U.S. economy led by credit market slumps.

Additional downward momentum was added by the shares of the financial firms after the news that Citigroup is likely to incur more losses in the upcoming months.