Strong jobs report pushes US stock futures up

NEW YORK (AP) ? A strong report on jobs sent U.S. stock futures higher Thursday even as the stalemate over the U.S. debt crisis continued.

The government reported first-time applications for unemployment benefits fell to the lowest level in four months. That’s a sign that employers are laying off fewer workers. The Labor Department said applications fell to a seasonally adjusted 398,000. That’s the first time applications have fallen below 400,000 in 16 weeks.

The positive news on jobs sent the Dow Jones industrial average futures up 25 points, or 0.2 percent, to 12,269.

Standard & Poor’s 500 index futures rose 5, or 0.4 percent, to 1,304. Nasdaq 100 index futures rose 11, or 0.5 percent, to 2,369.

Stocks have been falling since last Friday as an Aug. 2 deadline for raising the U.S. borrowing limit approaches.

On Thursday, House Republicans prepared a vote on a new plan to avoid a U.S. debt default. That legislation faces steep opposition with Senate Democrats. The White House has threatened to veto the proposal.

With the deadline for a deal just five days away, investors are becoming more fearful that the U.S. may lose its triple-A credit rating. That would raise interest rates and slow down an economy that is still recovering from the worst recession in decades.

On Wednesday, the Dow fell nearly 200 points, its biggest one-day drop since early June. It is now headed for its worst weekly decline since August 2010. The Dow is also about 4 percent below the 2011 high it reached on April 29.

Earnings results have been a relative bright spot. DuPont Co. rose 0.4 percent in premarket trading after the chemical maker said its earnings increased 5 percent on higher revenue. The company also raised its earnings outlook for the year.

Bristol-Myers Squibb Co. rose 1.4 percent ahead of the opening after the drugmaker reported earnings that were better than Wall Street analysts had anticipated. The company also increased its earnings-per-share forecast for 2011.

Yet Exxon Mobil Corp., the largest publicly traded oil company, fell about 2 percent as earnings fell below analysts’ estimates.

Sprint Nextel Corp. also fell 11 percent in premarket trading. The nation’s No. 3 wireless carrier said its loss widened in the second quarter, in part, because of a tax expense and investment losses.

Bond prices rose, pushing yields lower. The yield on the 10-year Treasury note fell to 2.95 percent from 2.97 percent late Wednesday.