Sept. 29 (Bloomberg) -- U.S. stock futures extended gains as government data showed jobless claims decreased more than forecast and gross-domestic product grew more than estimated in the second quarter, easing concern about an economic slowdown.
Standard & Poor’s 500 Index futures expiring in December rallied 1.1 percent to 1,161.4 at 8:32 a.m. in New York.
The U.S. economy grew at a 1.3 percent pace in the second quarter, faster than estimated last month and helped by exports and spending on services.
Applications for jobless benefits dropped by 37,000 in the week ended Sept. 24 to 391,000, the fewest since April, Labor Department figures showed. Economists forecast 420,000 claims, according to the median estimate in a Bloomberg News survey. An agency official said the data probably reflected a “slight mistiming” in the seasonal factors used to modify the figures.
U.S. stocks slid yesterday, halting a three-day rally for the S&P 500, on concern that European leaders are divided over how to handle Greece’s debt crisis. A four-day rout last week erased $1 trillion from U.S. equities amid concern Greek insolvency is inevitable and Europe can’t contain the damage. The decline left the S&P 500 trading at 12.4 times earnings in the past 12 months, 4.4 percent below its average valuation at the lowest point during the last nine bear markets, Bloomberg data show.
Earlier gains in futures today followed approval by Germany’s lower house of parliament for the expansion of the European bailout fund, the European Financial Stability Facility, in Berlin. Lawmakers in the Bundestag voted 523 in favor of the legislation, while 85 voted against; three abstained.
The legislation, which raises Germany’s guarantees to 211 billion euros ($287 billion) from 123 billion euros, is set to be debated and set to a non-binding vote in the upper house, or Bundesrat, tomorrow.
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