By Yashaswini Swamynathan
(Reuters) - U.S. stocks looked set to open higher on Thursday, building on a day-earlier rally after the Federal Reserve raised interest rates for the first time this year and indicated it was in no hurry to increase the pace of tightening.
The central bank on Wednesday raised rates by a quarter point to 0.75-1.00 percent, nodding to the continued strength in the labor market and a pick up in inflation.
However, the Fed stuck to its outlook for two more rate hikes this year and three more in 2018. Shares of big U.S. banks, which slipped on the less hawkish-than-expected stance on Wednesday, were up between 0.5 and 1.5 percent in premarket trading.
"A less aggressive Fed was clearly the message the markets wanted to hear and indeed acted accordingly," Peter Cardillo, chief market economist at First Standard Financial wrote in a note.
"The Fed's plan to stick to three rate hikes gave the green light for investors to focus on economic and corporate growth."
Backing Fed Chair Janet Yellen's optimism on the economy, a report from the Commerce Department showed homebuilding jumped in February as unseasonably warm weather boosted construction of single-family houses.
Moreover, the number of Americans filing for unemployment benefits fell last week, pointing to a further tightening in the labor market, according to a report from the Labor Department.
Dow e-minis were up 59 points, or 0.28 percent at 8:30 a.m. ET (1230 GMT), with 7,893 contracts changing hands.
S&P 500 e-minis were up 2.75 points, or 0.12 percent, with 53,199 contracts traded.
Nasdaq 100 e-minis were up 9.5 points, or 0.18 percent, on volume of 6,104 contracts.
On Wednesday, Wall Street scored solid gains and the Nasdaq Composite index hit an all-time high.
Shares of Tesla rose 2.8 percent to $262.94 after the electric carmaker said it would raise about $1.15 billion as the company speeds up the launch of its Model 3 sedan.
Biogen was off 2.6 percent to $285.13 after Morgan Stanley and Leerink downgraded the drugmaker's stock and cut price targets.
Johnson Controls was up 1.4 percent after agreeing to sell its safety gear business to 3M for $2.0 billion.
(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Anil D'Silva & Shri Navaratnam)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)