Stock futures pull back ahead of opening

[February 25, 2010]  NEW YORK (AP) -- Stock futures fell Thursday as fresh concerns about Europe's economy and investors avoid making major bets before reports on U.S. weekly unemployment claims and durable goods orders.

Overseas markets were mixed after the European Commission said economic sentiment in the 16 countries that use the euro worsened unexpectedly in February. Concerns that Greece will struggle to cut its budget and get debt problems under control are again worrying investors,

Global markets retreated earlier this month because traders were worried Greece's debt problems would spread to other European countries and upend a recovery.

The euro again fell, touching a nine-month low against the dollar.

In the U.S., investors are preparing for a Labor Department report that is expected to show first-time claims for unemployment benefits dropped by 18,000 to a seasonally adjusted 455,000 last week, according to economists polled by Thomson Reuters.

A decline would be welcomed after claims rose unexpectedly by 31,000 a week earlier. High unemployment remains one of the biggest obstacles to a strong, sustained economic recovery.

Separately the Commerce Department is expected to report orders to factories for big-ticket durable goods likely rose 1.5 percent in January, after a 1 percent gain a month earlier.

Economists predict the growth was driven by orders for aircraft. Stripping out transportation, durable goods orders grew 1 percent last month, after a 1.4 percent jump in December, economists forecast.

Both reports are due out at 8:30 a.m. EST.

Ahead of the opening bell, Dow Jones industrial average futures fell 41, or 0.4 percent, to 10,314. Standard & Poor's 500 index futures dropped 5.40, or 0.5 percent, to 1,098.20, while Nasdaq 100 index futures fell 7.75, or 0.4 percent, to 1,806.25.

Stocks snapped a two-day losing streak on Wednesday after investors received the reassurance they wanted from Federal Reserve chairman Ben Bernanke. During semiannual testimony before Congress, Bernanke reaffirmed the Fed's plans to keep interest rates low to help strengthen the economy. He testifies again Thursday.

Financial stocks rallied on the news, helping push the Dow up 92 points, or 0.9 percent. The S&P 500 rose 1 percent.

Bernanke's testimony overshadowed a disappointing report on new home sales. The Commerce Department said sales of new homes fell to a record low in January. A collapse in sales and home prices help drive the economy into recession. Recent reports show a recovery in the housing market remains choppy.

Meanwhile, bond prices rose Thursday. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.66 percent from 3.70 percent late Wednesday.

The dollar rose against other major currencies. Gold and oil prices fell.

Overseas, Japan's Nikkei stock average fell 1 percent. Britain's FTSE 100 rose 0.2 percent, Germany's DAX index gained 0.2 percent, and France's CAC-40 fell 0.3 percent.

[Associated Press; By STEPHEN BERNARD]

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