May 4, 2017 / 1:01 PM / a year ago

US STOCKS-Wall St set to open higher as Fed downplays economic weakness

* Traders raise odds of an interest rate hike in June

* Facebook falls on worries over future growth

* Tesla drops after reporting bigger-than-expected loss

* Weekly jobless claims fall more than expected

* Futures up: Dow 51 pts, S&P 6.25 pts, Nasdaq 18.5 pts (Adds details, comment, updates prices)

By Tanya Agrawal

May 4 (Reuters) - Wall Street was set to open higher on Thursday, a day after the Federal Reserve left interest rates unchanged and expressed confidence in the strength of the economy.

In a bullish statement, the central bank emphasized the strength of the labor market and said consumer spending continued to be solid, business investment had firmed and inflation has been “running close” to its target.

Futures traders are now pricing in a 72 percent chance of rate hike in June, up from 63 percent before the Fed issued its statement, according to the CME Group’s FedWatch Tool.

Shares of banks, that benefit in a rising rate environment, were higher in premarket trading. Bank of America, JPMorgan and Citigroup were up about 0.5 percent.

Sentiment also got a boost from signs that centrist Emmanuel Macron was heading for victory in France’s presidential election and another round of strong earnings reports from U.S. companies.

“Strong earnings have been a continuing theme for a while even with the moderate economic growth, and we’re also seeing the global economy pick up, so that’s all adding to the positive mood,” said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.

Data on Thursday showed new applications for jobless benefits fell more than expected last week. Another report showed U.S. trade deficit improved slightly in March amid broad declines in both imports and exports.

“The Fed wrote off the first quarter as being a temporary slowdown and I don’t think that’s really any surprise as the focus really should be on the jobs report,” said Brown, referring to the April U.S. non-farm payrolls data due Friday.

Dow e-minis were up 51 points, or 0.24 percent, with 17,818 contracts changing hands at 8:35 a.m. ET (1235 GMT).

S&P 500 e-minis were up 6.25 points, or 0.26 percent, with 106,841 contracts traded.

Nasdaq 100 e-minis were up 18.5 points, or 0.33 percent, on volume of 21,796 contracts.

Earnings of S&P 500 companies have generally come in above expectations, pushing the benchmark index to within one percent of its all-time high.

First-quarter profits at S&P 500 companies are estimated to have increased 14.2 percent, its strongest growth since 2011, according to Thomson Reuters I/B/E/S.

Facebook reported surging quarterly profit and revenue, but its shares fell 0.8 percent to $150.60 as investors showed some nervousness about future earnings.

Tesla was down nearly 2 percent to $305 after the electric-car maker posted a bigger-than-expected loss.

Dunkin’ Brands fell 1.5 percent to $55.50 after it said sales at Dunkin’ Donuts U.S. stores were flat.

AIG was up 1.1 percent at $62.22 after the insurer reported a better-than-expected operating profit. (Reporting by Tanya Agrawal; Editing by Savio D’Souza)

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