Stock futures climb following strong earnings globally; investors eye weekly jobless claims

Stock futures rise on strong global earnings

NEW YORK — Stock futures rose Thursday after a new batch of upbeat earnings and a modest drop in jobless claims renewed some optimism about the economy.

Southwest Airlines Co., ExxonMobil Corp. and Avon Products Inc. topped forecasts. Strong earnings worldwide gave European markets a lift. U.S. markets have received a boost over the past couple of weeks because of largely better-than-expected earnings and hopeful corporate forecasts for future growth.

A drop in initial jobless claims also boosted hopes for a recovery. Though the Labor Department said claims fell modestly and they were slightly better than forecasts, any decline is uplifting because unemployment remains high.

Analysts widely agree that new hiring would spark a stronger recovery. Signs of a sharp pickup in job creation would boost consumer confidence and drive retail sales higher, a key component of economic activity.

Economic reports in recent months have pointed to a slowdown in growth, countering optimism seen by company executives. The Federal Reserve said in its beige book report Wednesday that the recovery in some regions of the country was weakening. The confirmation by the Fed that a slowdown is occurring helped snapped a four-day winning streak for the Dow Jones industrial average.

The Labor Department said new claims for jobless benefits fell to 457,000 last week. That’s slightly better than the 459,000 forecast by economists polled by Thomson Reuters.

Ahead of the opening bell, Dow Jones industrial average futures rose 54, or 0.5 percent, to 10,502. Standard & Poor’s 500 index futures rose 6.80, or 0.6 percent, to 1,108.90, while Nasdaq 100 index futures rose 9.25, or 0.5 percent, to 1,879.00.

Southwest reported better-than-expected results after heavy traffic to start the summer travel season. ExxonMobil got a boost from rising oil prices during the quarter. Beauty products seller Avon got a boost from sales in Europe and Latin America.

Southwest shares jumped 39 cents, or 3.3 percent, to $12.40 in pre-opening trading. Avon rose 47 cents to $30.00. ExxonMobil rose 43 cents to $61.34.

Colgate-Palmolive’s earnings beat forecasts, but revenue fell short of expectations. It also said it would take a bigger charge than it first thought because of Venezuela devaluing its currency. The toothpaste and dishwasher soap maker’s shares dropped $4.84, or 5.8 percent, to $79.02.

Strong earnings and outlooks helped stocks overseas. European indexes all jumped following strong earnings from pharmaceuticals company AstraZeneca PLC, drug and materials company Bayer AG and telecommunications companies BT PLC and France Telecom SA.

Moody’s Investors Service also said ratings on banks in Europe would not be affected following tests by regulators on the continent to determine whether banks would survive a further economic slowdown. Only seven of 91 banks failed the test, providing assurances that the financial sector in Europe is stronger than previously thought.

The euro rose to $1.3070, its highest level since early May.

Britain’s FTSE 100 rose 0.7 percent, Germany’s DAX index rose 0.6 percent, and France’s CAC-40 gained 0.5 percent. Japan’s Nikkei stock average fell 0.6 percent.

Bond prices fell slightly. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.01 percent from 2.99 percent late Wednesday.