Stock futures surge on budget optimism MADRID (Ma

Stock futures surge on budget optimism
MADRID (MarketWatch) — U.S. stock futures soared on Thursday as investors became hopeful of progress on the political standoff that has shut down the government and raised concerns about the country’s abilities to pay its bills on time.

Adding to gains, futures for the Dow industrials (CBE JZ3) jumped 122 points, or 0.8%, to 14,850, while those for the Standard & Poor’s 500 index (GLC:SPZ3) surged 15.20 points, or 0.9%, to 1,664. Futures for the Nasdaq 100 index (GLC:NDZ3) rose 28.50 points, or 0.9%, to 3,161.

Jobless claims will be released at 8:30 a.m Eastern time. In the week ended Oct. 5, claims are forecast to rise to 312,000 from 308,000.

President Obama will meet with House Republicans leaders later in the day, on the heels of a meeting Wednesday with congressional Democrats.

Republican Paul Ryan, chairman of the House Budget Committee, on Wednesday outlined a plan to extend the nation’s debt limit for four to six weeks, pairing that with a framework for broader debt-reduction talks. The White House and Democrats have been insisting that any proposal cannot come with budget conditions. Treasury Secretary Jack Lew will testify on Thursday morning about the debt limit in the Senate Finance Committee.

“We’re beginning to see some progress,” said Peter Cardillo, chief market economist at Rockwell Global Capital. “Both sides need to save face, so whatever deals are in the making, it will be for a short period of time” and there will be a compromise, but still a relief for markets, he added.

But jaded investors are also staying guarded ahead of the meeting, said others. “Although a positive start is expected today, traders should be wary about the meeting resembling a boxing match weigh-in and knocking any optimism about the political stalemate out for the count,” said Jonathan Sudaria, dealer at London Capital Group, in emailed comments.

Cardillo said that markets need to move past the shutdown and debt worries, even if for only a few months, in order to focus on earnings and a new Federal Reserve chief. Obama on Wednesday nominated Janet Yellen for chairwoman of the Fed, and most believe if confirmed, she will continue current chairman Ben Bernanke’s path of an accommodative monetary policy.

Wall Street stocks ended mostly higher on Wednesday, with the S&P 500 (SNC:SPX) rebounding after two days of losses, on hopes that the political logjam could be loosening. The minutes of the Federal Open Market Committee meeting in September showed most members believe it still makes sense to taper bond-buying purchases this year. http://www.marketwatch.com/story/optimism-ove...atest_news