Stocks opened higher on Thursday, shaking off a higher jobless claims number, and rising with world equity markets on comments from Russian President Vladimir Putin.
“We seem to be reacting now more to Europe and Russia than anything happening here,” said Peter Boockvar, chief market analyst at The Lindsey Group. “Our economy is better but it’s still mixed.”
European shares pared their losses and turned higher on Thursday with the easing of geopolitical tensions in Ukraine helping investor sentiment. But flat GDP growth across the Eurozone, below expectations, and the first contraction in over a year of Germany’s economy still signaled underlying stress.
“It’s clear that the German market has suffered so much from what is going on in Russia,” Boockvar said.
On Thursday morning, the Department of Labor reported an increase to 311,000 in claims for unemployment benefits, above forecasts of 295,000, from 289,000 in the previous week.
Earlier, the futures index struggled for direction, but turned higher after Vladimir Putin said Russia would do “everything in our power” to end the bloodshed in Ukraine.
Reports also showed that import prices fell in July while export prices were unchanged for the month.
Other data out Thursday include natural gas inventories for last week.
In a morning speech in Crimea, which Russia annexed from Ukraine in March, Putin said: “We will do everything in our power so that this conflict is ended as soon as possible, so that the blood can stop flowing in Ukraine.” The Russian president added: “We need to consolidate and mobilize but not for war or any kind of confrontation … for hard work in the name of Russia.”
The comments boosted the U.S. futures market.
Earlier, Kiev denounced Russia’s dispatch of a humanitarian aid convoy and said the trucks would not be allowed to pass. Reports on Thursday morning said that the aid trucks were currently standing idle at a military base in Voronezh in Russia, near the Ukrainian border.
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In the Middle East, Israel and Palestinian factions agreed to extend the truce for five more days on Wednesday, and held indirect talks in Egypt for a more comprehensive agreement about Gaza.
In the Iraq crisis, Defense Secretary Chuck Hagel said late Wednesday there was less of chance for a U.S. rescue of stranded Yazidi refugees because U.S. military personnel found fewer people trapped on a mountain than expected.
Cisco Systems moved lower in pre-market trading after the networking equipment maker reported earnings and revenue that beat estimates but said it would cut 6,000 jobs, or 8 percent of its workforce.
Noodles & Co. declined more than 23 percent in pre-market trading as the restaurant firm reported disappointing earnings and revenue for its second quarter.
The Dow Jones Industrial Average opened up 17 points, or 0.10 percent, at 16,663.42, with Merck leading blue-chip gains and Cisco the greatest of the nine laggards.
The S&P 500 opened more than 3 points higher, or 0.18 percent, at 1,950.41, with all sectors gaining and consumer discretionary in the lead.
In the open, the Nasdaq was up more than 5 points, or 0.12 percent, at 4,439.44.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, fell to trade just below 13.
Two stocks advanced for every decliner on the New York Stock Exchange, with an exchange volume of 34 million and a composite volume of 78.6 million in the open.
The U.S. dollar declined against major world currencies.
The 10-year Treasury note yield continued to decline, yielding 2.39 percent in morning trading.
On tap this week:
1:00 p.m.: 30-year bond auction
Earnings: Estee Lauder
8:30 a.m.: PPI
8:30 a.m.: Empire manufacturing survey
9:00 a.m.: TIC data
9:15 a.m.: Industrial production
9:15 a.m.: Capacity utilization
9:55 a.m.: University of Michigan consumer sentiment