Pakistan violence could hurt stocks

NEW YORK (CNNMoney.com) -- Stock futures turned lower early Thursday after former Pakistani Prime Minister Benazir Bhutto was killed in a suicide attack leaving a rally in Rawalpindi, Pakistan.

At 8:35 a.m. ET, Nasdaq futures were down after being up slightly before the first reports of her death shortly after 8 a.m., while S&P futures fell further into negative territory.

Trading had been expected to be light as many market participants continue their year-end holiday celebration, which could add to market volatility.

Oil was slightly higher ahead of the government's weekly inventory report, as prices rose from earlier lows following the report of Bhutto's dealth. U.S. light crude was up 8 cents to $96.05 a barrel in electronic trading.

Asian markets ended mostly higher, although Tokyo's Nikkei index lost 0.6 percent.European stocks gained ground, as London returned from an extended holiday, although those markets also fell from earlier highs.

The dollar was flat against the euro and lower versus the yen.

Economic reports showed much weaker demand for durable goods than had been forecasts as November orders were up only 0.1 percent, rather than the 2.2 percent jump that had been forecast. Weekly initial jobless claims came in higher than forecasts.

The latest reading on consumer confidence for December will be released at 10 a.m. ET.

In corporate news, Internet search leader Google (GOOG, Fortune 500) suffered a legal setback when a federal appeals court revived a patent infringement claim by HyperPhrase Technologies that had been dismissed earlier in the month.

Wal-Mart Stores (WMT, Fortune 500), the world's largest retailer, announced late Wednesday it is having problems processing gift cards due to what it described as an error in a third-party verifier's systems.

Hollywood had a good weekend ahead of Christmas, with a total box office of $160 million, up 34 percent from a year earlier. The leading movie was "National Treasure: Book of Secrets" from Walt Disney (DIS, Fortune 500), which sold $65.4 million in tickets over the extended five-day holiday.

Student lender Sallie Mae (SLM, Fortune 500) announced plans late Wednesday to sell common and mandatory convertible preferred stock in order to raise $2.5 billion. Shares lost nearly 6 percent in after-hours trading on the news.

The Wall Street Journal reported that News Corp. (NWS, Fortune 500) unit Twentieth Century Fox and Apple (AAPL, Fortune 500) are preparing to announce a deal in which Fox movies would be available for rent digitally through Apple's iTunes store.