NEW YORK Wall Street headed for a modestly higher open Friday, with investors nervous about new record highs for oil prices but relieved about a surprising jump in new home construction.
Wall Street, hoping for an economic rebound in the second half of 2008, has been searching for signs that the housing market, while weak, is perhaps bottoming out. The market got some reassurance when the department said construction of new homes rose in April by 8.2 percent. The jump the largest monthly advance in more than two years was largely due to an increase in apartment construction, and compared to forecasts of a 0.7 percent decline.
However, energy worries continue to plague investors.
Light, sweet crude oil surged more than $3 to $127.43 a barrel a new trading high in premarket electronic trading on the New York Mercantile Exchange, before pulling back slightly to $127.08 a barrel.
Investors have been tracking energy prices closely, with the average U.S. retail price of gasoline around $3.77 per gallon and the average price of diesel fuel near $4.46 a gallon. Consumers and businesses alike are struggling with high commodities costs, despite mild overall readings on inflation, so Wall Street remains concerned about spending on discretionary items.
Dow Jones industrial average futures rose 22, or 0.17 percent, to 13,018.
Standard & Poor's 500 index futures rose 3.10, or 0.22 percent, to 1,427.70, and the Nasdaq 100 futures rose 2.25, or 0.11 percent, to 2,038.00.
The stock market rose Thursday for the second day in a row, driving the S&P 500 and Nasdaq to five-month highs, as oil prices reversed gains to trade lower and as data on jobless claims and Philadelphia-area manufacturing came in better than expected.
Late Thursday, Kohl's Corp. and Nordstrom Inc. two large U.S. department store chains both reported sharp declines in profits for the first quarter, but their results were better than analysts had forecast. Kohl's and Nordstrom shares rose in after-hours trading Thursday.
In other economic data expected Friday, the University of Michigan at 10 a.m. EDT releases its preliminary reading on May consumer sentiment. Economists forecast a marginal decline from April.
Government bond prices slipped ahead of the market's open. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.86 percent from 3.82 percent late Thursday.
Gold prices rose, while the dollar fell against other major currencies.
Overseas, Japan's Nikkei stock average rose 0.39 percent. In afternoon trading, Britain's FTSE 100 rose 1.14 percent, Germany's DAX index rose 1.59 percent, and France's CAC-40 rose 0.63 percent.