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Disney climbs on Q1 beat, layoff plans
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PepsiCo gains on quarterly profit, sales beat
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U.S. weekly jobless claims increase
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Futures up: Dow 0.63%, S&P 0.80%, Nasdaq 1.28%
(Adds comments; updates prices, details)
By Sruthi Shankar and Johann M Cherian
Feb 9 (Reuters) - U.S. main stock indexes were set for a
higher open on Thursday as a slew of strong quarterly earnings
and data showing a rise in weekly jobless claims outweighed
concerns about the Federal Reserve's rate-hike path.
Walt Disney Co climbed 5.6% premarket after topping
earnings estimates and announcing 7,000 job cuts as part of an
effort to save $5.5 billion in costs and make its streaming
business profitable.
PepsiCo Inc rose 1.8% as the snack and beverage
maker reported better-than-expected results, while drugmaker
AbbVie Inc gained 1.3% after beating fourth-quarter
profit expectations.
Futures got a lift after data showed initial claims for
state unemployment benefits rose 13,000 to a seasonally adjusted
196,000 for the week ended Feb. 4. Economists polled by Reuters
had forecast 190,000 claims for the latest week.
The data comes on the heels of a strong January employment
report that rattled markets last week.
"This is a definite sign that weakness in the labor market
is coming despite the huge job number last week," said Peter
Cardillo, chief market economist at Spartan Capital Securities.
"There are so many companies that are laying off people and
that eventually is going to weaken the job market. This for the
Fed is too soon, but if this trend continues and inflation
continues to head downwards, then the Fed's tune will change and
a pause is not that far away."
Traders are betting that the central bank will raise its
benchmark rate to a peak of 5.1% in July, largely in line with
the forecasts of Fed officials. However, money market traders
are also anticipating rate cuts this year. At 8:50 a.m. ET, Dow e-minis were up 213 points, or
0.63%, S&P 500 e-minis were up 33 points, or 0.8%, and
Nasdaq 100 e-minis were up 160.5 points, or 1.28%.
Megacap stocks including Meta Platforms , Apple Inc and Microsoft Corp climbed in the range of
1.3% to 2.0% as U.S. Treasury yields extended declines. Stocks have enjoyed an upbeat start to the year on hopes
that the Fed would steer away from its hawkish rhetoric and
leave the economy on a strong footing.
Of more than half of the S&P 500 companies that have reported fourth-quarter results so far, 69% have topped analysts' earnings estimates, as per Refinitiv IBES data. In a typical quarter 66% top estimates.
Ralph Lauren Corp gained 2.4% after beating quarterly revenue expectations on resilient demand for its high-end clothing and accessories. Salesforce Inc edged 1.8% higher as a source familiar with the matter told Reuters that hedge fund Third Point LLC owns a stake in the company.
Cardiovascular Systems Inc (CSI) jumped 48.3% after Abbott Laboratories said it would buy the medical device maker for $837.6 million. (Reporting by Sruthi Shankar, Medha Singh, Johann M Cherian and Ankika Biswas in Bengaluru; Editing by Sriraj Kalluvila)
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