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Weekly jobless claims at 211,000, below estimates

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Futures up: Dow 0.64%, S&P 500 0.72%, Nasdaq 0.90%

(Updates before markets open)

By Johann M Cherian and Purvi Agarwal

Jan 2 (Reuters) - Wall Street was set for a higher open

on the first trading session of 2025, with investors hoping a

fresh political landscape and more interest rate cuts will

enhance corporate and economic performance.

At 08:32 a.m. ET, Dow E-minis were up 274 points,

or 0.64%, S&P 500 E-minis were up 42.5 points, or 0.72%,

and Nasdaq 100 E-minis were up 190.5 points, or 0.90%.

The Federal Reserve easing interest rates for the first time

since 2020, investor hype around artificial intelligence and

expectations of companies potentially benefiting from

President-elect Donald Trump's policies helped U.S. indexes log

stellar gains in 2024. The benchmark S&P 500 notched its

best two-year run since 1997-1998.

Equity valuations are sitting above their long-term

averages, but could be justified if corporate profits stay

strong. Earnings per share for S&P 500 companies are projected

to rise 10.67% in 2025, according to data compiled by LSEG.

Brokerages expect the S&P 500 to touch levels between 6,000

and 7,000 points this year, up from Tuesday's close of 5,881.

However, 2024's rally ended with the S&P 500 and the Dow

posting monthly declines in December as markets priced in

Trump's policy proposals to be inflationary and likely to slow

down the Fed's policy easing pace this year.

With inflation still above the 2% target, traders see the

central bank leaving interest rates unchanged at its meeting

later this month, and expect borrowing costs to be lowered by

about 50 basis points by year-end, according to the CME Group's

FedWatch Tool.

Markets also weighed the likelihood that the new

administration could issue more debt to finance its policies,

which could worsen market volatility. The yield on the 10-year

benchmark Treasury note hovered near an eight-month

high.

"Investors are hopeful that a goldilocks scenario will be

the story of 2025, amid promises of lower taxes and the

deregulation under a second Trump presidency," said Susannah

Streeter, head of money and markets at Hargreaves Lansdown.

"But with fresh trade wars looming, if the worst of the

tariff threats are imposed, the bears could be back to disrupt

what has been a fairytale performance for the U.S. stock

market."

Among the first datasets of 2025, a Labor Department report

showed the number of Americans filing new applications for

jobless benefits came in at 211,000 for last week, compared with

estimates of 222,000, per economists polled by Reuters.

A final estimate on manufacturing activity in December is

due after markets open, but the main focus will be a slew of

labor market data next week.

In premarket trading, Tesla was up 1.2% ahead of

its quarterly deliveries numbers.

Among other megacaps, Meta and Amazon.com ( AMZN )

added over 1.1% each, while chip stocks Nvidia ( NVDA ) and

Broadcom ( AVGO ) climbed 1.3% and 2.3%, respectively.

These stocks were among the ones driving the S&P 500 Growth

index's 35% jump in 2024. The Value index rose 9.8%.

SoFi Technologies ( SOFI ) dropped 1.5% after brokerage KBW

downgraded the stock to "underperform" from "market perform".

Trading volumes are expected to be light in a week shortened

by Wednesday's New Year's holiday.