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Wall Street set to rebound as deals, earnings hope dim trade fears


By Amy Caren Daniel

(Reuters) - The three main U.S. indexes were set to open higher on Thursday as rose and a couple of big deals helped rekindle optimism and offset fears of a Sino-U.S. trade war.

fell 12.3 percent in premarket trading after the chipmaker's $18.9 billion deal to buy caught investors and analysts by surprise. shares jumped 18.1 percent.

Comcast, up 0.4 percent, made a $34 billion bid for Sky, trumping an offer from Shares of Rupert Murdoch's company gained 0.4 percent.

Markets were rattled on Wednesday after the threatened to impose tariffs on an additional $200 billion worth of Chinese goods. said Thursday the two countries have not been in touch about restarting negotiations and while it does not want a trade war, it would fight if necessary.

"While markets have typically reacted negatively to any escalation on trade, the overall impact has been relatively modest under the circumstances, which suggests investors are far from panic mode right now," Craig Erlam, at Oanda, said in a note.

"There still seems to be some hope that common sense will prevail and a full-blown trade war will be averted."

Wednesday's drop though was not as steep as in late March and early April when the tumbled more than 2 percent on four occasions as trade rhetoric escalated.

and Caterpillar, among the Dow's biggest drags on Wednesday and the hardest hit by the recent trade dispute, were up about 1 percent.

Also helping sentiment was recouping some ground following sharp losses in the previous session. [O/R]

At 8:53 a.m. ET, Dow were up 207 points, or 0.84 percent. were up 17.25 points, or 0.62 percent and were up 46.75 points, or 0.64 percent.

rose 1.9 percent after the company's quarterly profit fell less than expected. Delta though slashed its full-year earnings forecast as fuel costs surged.

Overall, companies are expected to post second-quarter profit growth of around 21 percent, according to I/B/E/S.

The earnings season kicks off in earnest on Friday, when big Wall Street banks JPMorgan Chase, and report results. Shares of all three banks were up about 0.7 percent.

Weekly jobless claims hit a two-month low last week, according to a Labor Department report, in a sign that labor market conditions remained robust in early July.

While consumer prices barely rose in June, the underlying trend continued to point to a steady buildup of inflation pressure that could keep the Federal Reserve on a path of gradual interest rate increases.

(Reporting by in Bengaluru; Editing by Shounak Dasgupta)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, July 12 2018. 18:59 IST