Wall St. shrugs off Greenspan

NEW YORK (CNNMoney.com) -- Stock futures rose just before the U.S. market open as investors were cheered by a better than expected report on durable goods orders, allowing them to look past a warning from former Federal Reserve Chairman Alan Greenspan that a big correction is due in Chinese stocks.

U.S. stock futures had been lower on Greenspan's comments before the 8:30 a.m. ET economic report. Markets also closed lower in Asia and were down in early trading in Europe following those comments.

But the report about durable goods was stronger than the overall 0.6 percent rise in new orders in April would indicate. The March reading was revised to a 5.0 percent jump from an earlier reading of a 4.3 percent rise. That big revision allowed economists and investors to look past the fact that the April gain was less than the forecasted 0.9 percent rise.

The report also had some signs of strength in other numbers, including a 1.2 percent increase in capital spending excluding aircraft and defense items, a reading that is taken as a proxy for business spending. And new orders for primary metals was up 4.3 percent, suggesting increased production ahead.

"The revision and other indicators in the report are stronger than what the headline number indicates," said Peter Cardillo, chief market economist for Avalon Partners.

Cardillo said the desire of portfolio managers not to have a long position in stocks going into the holiday weekend is probably more of a headwind for stocks Thursday than are Greenspan's comments.

"Greenspan just gave a little nudge to the market, but I think it would have unfolded much the same way, even without his comments," said Cardillo early Thursday.

In late February, a sharp drop in stocks in Shanghai prompted a 416-point drop in the Dow Jones industrial average. But the decline in the Shanghai index was far more modest Thursday than on that day, and futures are not down nearly as much on the former Fed chairman's comments as they were in February.

Another economic report Thursday showed jobless claims rose more than forecast to 311,000 people filing for initial benefits last week, up from 296,000 the week before, which was also revised higher. Economists had forecast it would come in at 305,000.

In corporate news, Alcoa (Charts, Fortune 500) shares were in up Frankfurt trading early Thursday after the company issued an after-hours statement that reaffirmed its hostile bid for Canadian rival Alcan (Charts) and said it is prepared to move forward as quickly as possible to address the remaining conditions to the offer. Alcan's board had rejected the offer on Tuesday. Shares of Dow component Alcoa hit a five-year high in trading Wednesday ahead of that statement.

Another Dow component, computer and peripheral maker Hewlett-Packard (Charts, Fortune 500), reached a settlement with the Securities and Exchange over the company's failure to disclose the reason for a director's resignation last year amid a board-level investigation into company leaks. The company didn't admit or deny the agency's findings that it should have disclosed more details about the controversy, and no fine or other penalty was imposed. Shares gained 0.3 percent in after-hours trading.

Shares of Dow component General Motors (Charts, Fortune 500) lost nearly 3 percent in Frankfurt trading after it said it would sell about $1.1 billion of corporate debt that can be converted into shares of its stocks. It also received a commitment for a $4.1 billion line of credit to be backed by its remaining stake in its GMAC finance unit.

GM also said Thursday that it had received a document request from the SEC relating to derivative trading on certain foreign exchange and commodities contracts. And it said it now expects its losses related to Delphi's bankruptcy and settlement with the United Auto Workers union to be about $7 billion. That's in the range of $6 billion to $7.5 billion of exposure it had previously given.

Luxury home builder Toll Brothers (Charts, Fortune 500) reported a sharper than forecast drop in earnings early Thursday.

At 10 a.m. ET the Census Bureau will report on the pace and average price of new home sales in April. Economists surveyed by Briefing.com are forecasting that the pace of sales was little changed from the weak March reading.

Oil prices retreated in early trading Thursday, following a run-up in prices Wednesday on a report by the United Nations' nuclear agency that opened the door to tougher sanctions against Iran. U.S. light crude lost 36 cents to $65.41 a barrel in electronic trading.

Treasury prices were little changed, leaving the yield on the 10-year note near the 4.85 percent level reached late Wednesday. The dollar was higher against the euro but lower against the yen.