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Morning Market Roundup: Unemployment Rises, Oil UP, Prepare for the IKEA's Hotel Chain


Here’s what’s important in the business world this morning:

Unemployment: The number of Americans applying for unemployment benefits edged up slightly last week by 2,000.

Unemployment benefit applications rose to a seasonally adjusted 366,000, the Labor Department said. The less volatile four-week average fell by 5,500 to 363,750. That was the lowest level since late March.

Applications have trended lower in the past two months.

The total number of people receiving some kind of unemployment assistance fell, dipping to 5.68 million for the week ending July 28, 70,000 below the previous week.

IKEA: IKEA is planning to launch a chain of budget hotels in Europe.

The property division of Inter IKEA -- the company that owns the IKEA intellectual property rights -- is planning hotels in 100 locations across Europe. The first two hotels are expected to open in Germany in 2014. Other locations earmarked for hotels include Belgium, the Netherlands, the Nordic countries, Britain and Poland.

Although the chain won't use IKEA's name or furniture, it will ingrain the IKEA philosophy of "good quality at a reasonable price.”

Inter IKEA, which already owns a handful of hotels in Europe since the start-up of the property division in the 1990s, will work with another company to operate the chain. Muller declined to reveal the name of the hotel chain, but it is expected to be released in an official announcement in September.

IKEA, the world's largest furniture retailer, employs 131,000 people in 41 countries and its 287 stores drew in 655 million customers in 2011. It has a complex corporate structure where the ownership of IKEA's outlets is separated from the ownership of its brand name and intellectual property rights.

Earlier this year, the IKEA Group announced a collaboration deal with Chinese consumer electronics firm TCL under which it would start selling TV's and sound systems integrated into IKEA furniture.

Oil: Oil remained above $94 a barrel Thursday after an unanticipated drop in U.S. crude inventories and stronger retail sales helped keep near three-month high.

Benchmark oil for September delivery was down 13 cents to $94.21 a barrel in midday trading in Europe in electronic trading on the New York Mercantile Exchange. The contract rose 90 cents to finish at $94.33 per barrel Wednesday in New York.

On the ICE Futures exchange in London, Brent crude was up 35 cents at $114.66.

The Energy Department said Wednesday that stockpiles fell 3.7 million barrels last week to 366.2 million barrels, suggesting stronger demand. Analysts had predicted a decline of 1.5 million barrels, according to Platts, the energy information arm of McGraw-Hill. It marked the third consecutive large weekly decrease in oil supplies. Decreases tend to cause a rise in oil prices.

U.S. Futures: Stock futures rose Thursday after a surprisingly strong report about the housing sector.

Home construction slowed, but investors keyed on the number of housing permits issued. That reached a four-year high.

Dow Jones industrial futures rose 26 points to 13,161. The broader S&P futures tacked on 2.8 points to 1,406.30. Nasdaq futures gained 7.25 points to 2,745.75.

The Commerce Department reported that construction of single-family homes and apartments dipped 1.1 percent in July compared with June, to a seasonally adjusted annual rate of 746,000. In June, the rate had been 754,000, the fastest pace since October 2008.

The Associated Press contributed to this report.

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