NEW YORK (CNNMoney) -- U.S. stocks were headed for a modestly higher open Thursday, as investors digested upbeat economic data and strong sales results from retailers.
The Dow Jones industrial average (), S&P 500 ( ) and Nasdaq ( ) futures were up between 0.2% and 0.4%. Stock futures indicate the possible direction of the markets when they open at 9:30 a.m. ET.
Investors will also be tuning into Federal Reserve Chairman Ben Bernanke's second day on Capitol Hill, as he gives his semi-annual report on the economy to the Senate.
On Wednesday, the Fed chief faced the House Financial Serves Committee -- and what he had to say wasn't exactly rosy. Bernanke failed to provide hope that the Fed will continue to offer monetary support to the market, sending U.S. stocks modestly lower.
Investors also digesting indications that China's economy is improving. China's official purchasing managers' index rose to 51 in February from 50.5 the prior month, suggesting that the manufacturing sector is expanding -- albeit slowly.
A separate PMI report from banking company HSBC also showed manufacturing activity edged up last month. But the index reading of 49.6 was just below the 50 threshold for expansion in the sector.
Meanwhile, worries about the European debt crisis continue to loom in the background. European leaders will gather in Brussels on Thursday for a two-day summit to determine the size of their financial firewall, and to discuss the details of a pact on fiscal discipline.
Euro-area officials tentatively approved a second €130 billion bailout for Greece last week, and the European Central Bank announced Wednesday that it loaned €529.5 billion to European banks through a second long-term refinancing operation.
The close watch on the global oil market and rising gas prices continued Thursday, as gas prices climbed for the 23rd straight day to just below $3.74 a gallon.
Personal income rose 0.3% in January, while spending edged up 0.2%. Economists were expecting income and spending to have increased by 0.4% each.
The ISM manufacturing index is expected to rise to 54.7 for February from 54.1 the prior month. Any reading above 50 signals expansion. Meanwhile, construction spending for January is expected to tick up by 1.0%.
Auto sales results for February are also due throughout the day.
Clothing retailer Kenneth Cole (Fortune 500), which owns Victoria's Secret and Bath and Body Works, said same-store sales in February rose 8%.) beat fourth-quarter earnings and sales estimates. Fellow retailer Limited Brands ( ,
Shares of Wendy's () edged up after the fast food chain beat earnings estimates by a penny. The company also topped sales estimates.
Grocery chain Kroger's (Fortune 500) stock was also higher thanks to better-than-expected fourth-quarter results.,
World markets: European stocks were higher in afternoon trading. Britain's FTSE 100 ( ) added 0.8%, the DAX ( ) in Germany gained 0.9% and France's CAC 40 ( ) ticked up 0.8%.
Asian markets ended lower. The Shanghai Composite () slid 0.1%, while the Hang Seng ( ) in Hong Kong dropped 1.4% and Japan's Nikkei ( ) lost 0.2%.
Oil for April delivery rose 14 cents to $107.21 a barrel.
Gold futures for April delivery increased $3.10 to $1,714.40 an ounce.
Bonds: The price on the benchmark 10-year U.S. Treasury fell, pushing the yield up to 2.02% from 1.98% late Wednesday.
|What we want Apple to unveil at WWDC|
|Millennials squeezed out of buying a home|
|7 traits the rich have in common|
|Big Data knows you're sick, tired and depressed|
|Your car is a giant computer - and it can be hacked|
|Overnight Avg Rate||Latest||Change||Last Week|
|30 yr fixed||3.85%||3.81%|
|15 yr fixed||2.97%||2.91%|
|30 yr refi||3.85%||3.81%|
|15 yr refi||3.01%||2.99%|
Today's featured rates: