U.S. Index futures remain higher amid consumer spending gain

NEW YORK (BLOOMBERG) - U.S. stock-index futures maintained gains, indicating equities will rebound, after data showed household spending climbed in May by the most in almost six years.

Standard & Poor's 500 Index E-mini contracts expiring in September added 0.3 per cent to 2,106 at 8:34 a.m. in New York, after earlier rising as much as 0.6 per cent.

"The underlying speed of the U.S. economy is more than high enough to cope with higher interest rates," said Espen Furnes, who helps oversee $85 billion at Storebrand Asset Management in Oslo. "I'm not that concerned that the Fed will be too aggressive and kill off growth."

Purchases increased 0.9 per cent, the biggest gain since August 2009, after rising 0.1 per cent in April, Commerce Department figures showed. The median forecast of economists in a Bloomberg survey called for a 0.7 per cent advance. Incomes rose 0.5 per cent for a second month.

A separate report showed filings for U.S. unemployment benefits held below 300,000 for the 16th straight week, signaling a tighter labor market that will help propel growth in the second half of 2015.

Three rounds of Federal Reserve bond purchases and near- zero interest rates helped the S&P 500 more than triple during the six-year bull market. The gauge climbed last week by the most since April after the Fed signaled it won't rush to raise rates, as officials hold out for more decisive evidence of an economic rebound.

Data Wednesday showed a bigger gain in consumer spending in the first quarter helped the world's largest economy contract less than previously estimated. Reports earlier this week also showed sales of new and previously owned homes rose more than forecast in May.

Investors are also watching the Greek debt standoff. Euro- area finance ministers were faced with competing proposals aimed at breaking the five-month impasse after talks between Prime Minister Alexis Tsipras and his country's creditors failed to produce a compromise.

"Markets have indeed jumped back a little on hope for a Greek solution, but that optimism seemed to be somewhat misplaced for now at least," Mr Furnes said. "Greece is not that important to financial markets, but the risk of contagion is the real worry. During the last weeks we have seen some sympathy moves, but nothing to suggest any escalation of that risk."

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