Stocks ready to resume rally

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NEW YORK (CNNMoney.com) -- Stocks looked set for a higher open Thursday, as investors looked past stagflation concerns and bet that the Federal Reserve remains committed to juicing economic growth.

A little more than two hours before the start of trading, Nasdaq and S&P futures were higher and indicating a positive open for Wall Street.

Stocks rose Wednesday as investors shrugged off signs of rising inflation and focused instead on the minutes from the Fed's last meeting. The central bank forecast slower growth and continued risks to the economy from housing and credit markets. But the minutes suggested bankers are prepared to cut interest rates further.

The Fed's gloomier economic forecast Wednesday was followed by a similar downgrade in the growth outlook from the EU Commission, which cut its estimate of economic growth in the euro zone to 1.8% from 2.2%, due to what it described as unusually uncertain global economic prospects.

Markets in Asia closed mostly higher Thursday on the expectations of more rate cuts from the Fed, while markets in Europe also rallied in early trading.

Oil prices briefly rose above the $100 a barrel mark again in early trading, but then slipped lower in early trading ahead of the 10:30 a.m. ET weekly report on U.S. fuel inventories, which is a day late this week due to Monday's federal holiday.

A barrel of light, sweet crude for April delivery fell 14 cents to $99.56 in electronic trading. The March contract, which is now expired, settled at a record close of $100.74 a barrel Wednesday.

Investors will take in a string of economic readings, including a report on weekly jobless claims at 8:30 a.m. ET. A reading on leading economic indicators from research firm the Conference Board is due at 10 a.m. ET. A report on manufacturing in eastern and central Pennsylvania and southern New Jersey from the Philadelphia Fed also comes out at 10 a.m. ET.

In corporate news, Reed Elsevier, the joint venture between British (RUK) and Dutch (ENL) companies of the same name and owner of the LexisNexis database, agreed to buy U.S. risk management firm ChoicePoint (CPS) for $50 a share cash. The deal is valued around $4 billion and pays a 49% premium over ChoicePoint's closing price on Wednesday.

Embattled bond insurer MBIA (MBI) late Wednesday rejected a proposal by activist shareholder William Ackman that it be split into two companies, saying the proposal should not be considered viable.

Earnings are due before the market open from J.C. Penney (JCP, Fortune 500). Retailers have been hit by cooling sales as consumers have tightened the hold on their wallets.

Several state attorneys general have subpoenaed documents from Anheuser-Busch (BUD, Fortune 500) and Miller Brewing, the U.S. arm of SABMiller (SBMRY), as part of a probe into the companies' marketing of caffeinated alcoholic beverages.

Ford Motor (F, Fortune 500) missed its internal 2007 market share target in China despite 25% growth in its sales there, according to a report from the Detroit News.