The Labor Department releases first-time claims for jobless benefits for the week ended October 13 at 8.30 a.m. EDT. Economists forecast a total of 365,000 new filings, compared with 339,000 in the prior week.

China likely hit the bottom of a seven-quarter long economic downturn between July and September, but the slowest three months of growth since the depths of the financial crisis and a cloudy housing market outlook make recovery prospects tepid.

European leaders will try to bridge deep differences over plans for a banking union at a summit on Thursday but no substantial decisions are expected, reviving concerns about complacency in tackling the three-year-old debt crisis.

Verizon Communications Inc (VZ.N) posted higher quarterly revenue on strength in its wireless business after it raised wireless data pricing and started selling the latest Apple Inc (AAPL.O) iPhone.

Morgan Stanley (MS.N) reports third-quarter earnings, which are expected to be bolstered by higher stock and bond prices. Other major companies announcing results include Google (GOOG.O), Microsoft (MSFT.O) and Advanced Micro Devices (AMD.N).

The Conference Board releases its report on September leading economic indicators at 10 a.m. EDT. Economists forecast a 0.2 percent rise, against a 0.1 percent drop in August.

Sprint Nextel (S.N) is negotiating a deal with its partner Clearwire that would give Sprint control of Clearwire without an acquisition, the Wall Street Journal reported on Wednesday, citing people familiar with the matter.

Philadelphia Federal Reserve Bank releases September business activity survey at 10 a.m. EDT. Economists forecast a reading of 1.0, versus -1.9 in August.

American Express Co (AXP.N) shares were down 1.7 percent after the bell on Wednesday following the release of its results. The company's third-quarter profit rose only marginally and spending growth remained muted for the second quarter running as corporate executives cut spending on travel and entertainment.

EBay Inc (EBAY.O) reported strong quarterly results late on Wednesday, but the e-commerce company gave a cautious forecast for the crucial holiday season amid a brewing price war between big retailers and rival Amazon.com Inc AMZN.0. EBay shares were down 4.1 percent after the bell.

European shares .FTEU3 fell 0.1 percent on Thursday on concerns over corporate earnings.

The S&P 500 rose for the third consecutive day on Wednesday after housing starts hit a four-year high, but the Dow was weighed down by IBM after it posted weak revenue.

The Dow Jones industrial average .DJI rose 5.22 points, or 0.04 percent, to 13,557 at the close. The Standard & Poor's 500 Index .SPX gained 5.99 points, or 0.41 percent, to finish at 1,460.91. The Nasdaq Composite Index .IXIC advanced 2.95 points, or 0.10 percent, to close at 3,104.12.

(Reporting by Atul Prakash; editing by Patrick Graham)

• A Permanent Economic Emergency