Stock futures point to big gains at open

[November 23, 2010]  NEW YORK (AP) -- Confidence that Ireland will work out the details for a bailout and strong interest in General Motors' initial public offering lifted stock futures Thursday.

Markets had been roiled in recent days by fears that Ireland would be the latest European country to face a possible default, following Greece's near collapse in May. But confidence is building that Ireland will reach a deal soon with the European Union and International Monetary Fund to provide a backstop should the country not be able to pay its outstanding debt. The EU, IMF and Irish leaders are meeting Thursday.

Ireland is also expected to accept a loan worth tens of billions of euros from Britain, which is not part of the 16-nation group that uses the euro. Britain's biggest banks are heavily invested in Irish debt, so they would face big losses if the country can't repay its loans.

The euro rose sharply against the dollar as traders became more comfortable with Ireland's debt problems. Major European stock indexes all rose more than 1 percent. Ireland is struggling because it had to take over three major banks after the real estate market collapsed.

General Motors initial public offering is also drawing a lot of interest back to stocks as the market tries to bounce back from a recent retreat. The Dow Jones industrial average has dropped six of the past eight days.

GM's offering could be worth $23 billion as the automaker emerges from taxpayer-funded bankruptcy. The government's stake in the company is being reduced from about 61 percent to 33 percent as a result of the offering.

Shares were offered at $33 apiece, and it could be the largest IPO in history including the sale of preferred shares.

GM's competitor Ford Motor Co. said Thursday it is selling part of its small stake in Japanese automaker Mazda. Ford shares rose 2 percent in pre-opening trading.

Ahead of the opening bell, Dow Jones industrial average futures rose 95, or 0.9 percent, to 11,090. Standard & Poor's 500 index futures rose 13.30, or 1.1 percent, to 1,190.80, while Nasdaq 100 index futures rose 24.50, or 1.2 percent, to 2,121.50.

Britain's FTSE 100 rose 1.4 percent, Germany's DAX index gained 1.5 percent, and France's CAC-40 jumped 1.6 percent.

Investors looking for clues about the health of the broader U.S. economy received another report that indicates employers are not rapidly hiring many workers, but not cutting many jobs either.

The Labor Department said first-time claims for unemployment levels rose slightly last week, but essentially inline with economists' forecast. Claims remain near their lowest levels in two years, but not low enough to signal the high unemployment rate will drop soon.

Bond prices retreated as investors moved back into riskier assets. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 2.92 percent from 2.87 percent late Wednesday.

[Associated Press; By STEPHEN BERNARD]

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