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 The agreement between Treasury Secretary Henry Paulson and lenders would freeze interest rates for up to five years for some subprime borrowers. It was completed Wednesday after talks between the Treasury Department, mortgage lenders and Wall Street banks.
The fallout from the subprime crisis has weighed on the financial services sector this year, with banks and brokerages writing down some $80 billion worth of securities tied to mortgages. Royal Bank of Scotland Group PLC, the U.K.'s second-biggest bank, on Thursday reported it suffered $3 billion in writedowns caused by slumping credit markets.
Investors are also concerned about the impact of the faltering housing market on the consumer. They might get a better grasp on consumer spending Thursday as retailers release same-store sales figures for November, which include Black Friday promotions, the traditional first day of holiday shopping.
Wall Street is hoping to extend Wednesday's gains, when stocks were buoyed by strong economic data. The Dow Jones industrial average shot up 196 points.
Dow futures rose 70, or 0.36 percent, to 13,526. Standard & Poor's 500 index futures rose 6.60, or 0.44 percent, to 1,493.40, and the Nasdaq composite index added 15.75, or 0.75 percent, to 2,117.00.
Bond prices fell. The yield on the benchmark 10-year Treasury note, which moves opposite its price, edged up to 3.96 percent from 3.95 percent late Tuesday. The dollar was mixed against other major currencies except the yen, while gold prices rose.
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 Light, sweet crude rose $1.31 to $86.18 per barrel in premarket electronic trading on the New York Mercantile Exchange. Government data released Wednesday showed an increase in U.S. supplies of gasoline and distillates.
Investors will also be looking overseas to get a glimpse about interest rates. The Bank of England cut its key interest rate to 5.5 percent from 5.75 percent on Thursday, and the European Central Bank will also make an announcement this morning.
It is expected the Federal Reserve will make some kind of cut when it meets on Tuesday. Economists continue to debate if it will be a half-point or quarter-point move.
In corporate news, Coca-Cola Co. said President and Chief Operating Officer Muhtar Kent will become chief executive as of July 1. He will replace Neville Isdell, who will retain the chairman position until April 2009.
Overseas, Japan's Nikkei stock average closed up 1.70 percent, while Hong Kong's Hang Seng index rose 0.73 percent. Britain's FTSE 100 added 1.09 percent, Germany's DAX index rose 0.59 percent, and France's CAC-40 increased 0.93 percent.
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On the Net:
New York Stock Exchange: http://www.nyse.com/
Nasdaq Stock Market: http://www.nasdaq.com/
[Associated Press; By JOE BEL BRUNO]
Copyright 2007 The Associated Press. All rights reserved. This
material may not be published, broadcast, rewritten or
redistributed.
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