North American markets are likely to head higher Thursday morning, boosted by encouraging U.S. productivity and jobless reports, and strong U.S. retail sales.

U.S. workers were much more productive than previously thought in the fourth quarter of 2004. The U.S. Labor Department said today that nonfarm business productivity grew at a seasonally adjusted annual rate of 2.1% from October through December. That was up from the initial estimate of a 0.8% increase and well above the 1.3% rate recorded in the third quarter.

However, U.S. labour productivity slowed over the course of 2004: the annual rate was 4%, down from 4.4% in 2003.

Separately, the U.S. Labor Department said initial jobless claims fell by 1,000 to 310,000, after seasonal adjustments, in the week that ended Feb. 26. Economists expected claims to rise by 6,000.

U.S. retailers saw improved sales in February. The International Council of Shopping Centers-UBS sales preliminary tally of 52 stores rose 4.4%, much better than the 3.3% increase it had projected. The tally is based on same-store sales,

Later today, the Institute for Supply Management will release its February nonmanufacturing report, Economists expect the index, which measures activity in the U.S. services sector, to move up to 60.0 from 59.2.


Crude oil futures hit a four-month high Wednesday, sending U.S. stocks into negative territory but pushing Canadian stocks to solid gains.

At close, the S&P/TSX composite index was up 72.04 points or 0.74% at 9,800.07, the second day in a row of double-digit gains. The TSX Venture composite index added 10.58 or 0.53% at 2,005.39.

On Wall Street, the Dow Jones industrial average see-sawed throughout the day before closing down 18.03 points or 0.17% at 10811.97, while the tech-heavy Nasdaq composite index shed 3.75 points or 0.03% to 2067.50 and the S&P 500 slipped 0.33 of point to 1210.08.

In New York, the spike in crude futures offset upbeat comments about the U.S. economy from Federal Reserve Chairman Alan Greenspan.

In remarks to the House Budget Committee Greenspan did not hint at any upcoming changes to the Fed’s monetary policy. He emphasized the importance of congressional action on Social Security, and said hiking taxes would be negative for the economy right now. The market seemed relieved that he had not hinted at a more hawkish policy on rates, but the surge in oil prices was too great to ignore.