Higher open on tap after trade data, mood fragile

By Edward Krudy

NEW YORK (Reuters) – U.S. stock index futures pointed to a higher open on Thursday after six days of losses as a narrowed U.S. trade deficit was seen as one positive point in a recent avalanche of weak economic data.

But the mood remained fragile with many analysts expecting the S&P 500 to retest its March 2010 lows after falling more than 6 percent since a peak in May, and the latest data from the labor market provided little room for optimism.

The trade deficit “points toward a little better growth in Q2 than many people had been thinking before this,” said David Ressler, chief U.S. economist at Nomura Securities in New York.

S&P 500 futures rose 5.6 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures rose 45 points, and Nasdaq 100 futures rose 7.25 points.

The S&P 500 is up just 1.7 percent for the year so far. The index faces resistance at 1,310, around its low in late May, and has support at 1,250, its March low, according to analysts at Brown Brothers Harriman in New York.

U.S. stocks have held in a pattern recently of selling off in the second half of the day as investors look for a bottom.

The U.S. trade deficit narrowed unexpectedly in April, as U.S. exports rose to a record and imports from Japan tumbled more than 25 percent in the aftermath of the March earthquake, tsunami and nuclear disaster, a U.S. government report showed on Thursday.

The number of Americans filing new claims for unemployment benefits rose by 1,000 last week, however, according to a report on Thursday that could add to fears the labor market recovery has stalled.

Texas Instruments Inc slashed its earnings and revenue forecasts, blaming the shortfall on major client Nokia’s ailing cellphone business. Shares of Texas Instruments edged up in premarket trade.

Brent crude oil rose above $118 a barrel on Thursday after surging in the previous session as Saudi Arabia failed to convince OPEC members to raise output targets and data showed U.S. crude stocks fell sharply last week.