* Worries over fiscal cliff keep investors cautious
* Initial jobless claims fell sharply last week
* Best Buy surges on report its founder to make buy offer
* Futures: S&P down 0.6 pt, Dow up 28 pts, Nasdaq down 2 pts
By Leah Schnurr
NEW YORK, Dec 13 Wall Street was set to open
little changed on Thursday after data showed first time claims
for jobless benefits fell sharply last week, but investors were
cautious about making aggressive bets in the midst of ongoing
"fiscal cliff" negotiations.
Shares of Best Buy Co surged more than 15 percent
after a report that the company's founder is expected to make a
fully financed offer to buy the consumer electronics retailer by
the end of the week. Best Buy was up 15.5 percent at $14.07 in
In the European Union, finance ministers reached a deal to
make the European Central Bank the bloc's top banking
supervisor. The move could boost confidence in leaders' ability
to tackle the region's sovereign debt crisis.
Still, equities gains were likely to be constrained as the
set of tax hikes and spending cuts that are set to come into
effect in the new year remained at the forefront of investors'
minds. Negotiators on Wednesday warned the showdown over
reaching a deal on the so-called fiscal cliff could drag on past
The Federal Reserve on Wednesday announced a fresh bout of
stimulus for the U.S. economy, but markets focused on comments
from Chairman Ben Bernanke, who reiterated that monetary policy
would not be enough to offset going over the fiscal cliff.
Investors are worried that doing so could send the economy
back into recession, though most expect a deal will be struck
"Obviously people still have their eyes on the fiscal cliff
negotiations," said Peter Jankovskis, co-chief investment
officer at OakBrook Investments LLC in Lisle, Illinois.
"It's just a wait-and-see mode. But it does suggest to me,
that if they actually do reach a deal, hopefully people will
look back and see the predominance of good news and maybe we
will get a nice pop out of it."
Initial claims for state unemployment benefits dropped
29,000 to a seasonally adjusted 343,000, pointing to healing in
the labor market.
Separate reports released at the same time showed producer
prices fell more than expected in November, while retail sales
rebounded. Business inventories are due at 10 a.m. (1500
S&P 500 futures edged up 0.6 point but were below
fair value, a formula that evaluates pricing by taking into
account interest rates, dividends and time to expiration on the
contract. Dow Jones industrial average futures rose 20
points, while Nasdaq 100 futures were up 0.25 point.
Sprint Nextel Corp is offering $2.1 billion to buy the
rest of Clearwire Corp to get full ownership of its
wireless spectrum. Shares of Clearwire jumped 11.6 percent to
$3.07, while Sprint slipped 0.7 percent to $5.62.
CVS Caremark Corp gained 4.9 percent to $49.85 after
it said it expects higher earnings next year.