US stock futures edged lower on Thursday after weekly jobless claim shot up to 16 year high, further intensifying the recession fears. Uncertainty over the fate of automakers and financials dampened sentiment.

At 8:37 am ET, Standard & Poor's 500 Index futures expiring in December fell 15.90 points to 796.60. Dow Jones Industrial Average futures dropped 124 points to 7903. Nasdaq Composite Index futures shrank 17 points to 1,075.50.

A release by Department of Labor on Thursday showed number of Americans filing first- time claims for unemployment benefits rose by 27,000 to 542,00 in the week ending Nov. 15. It is the highest level for jobless claims since July 1992. Economists had forecast jobless claims to climb to 503,000. The four-week average of seasonally adjusted initial jobless claims, a less volatile gauge, increased by 15,750 to 506,500. Continuing claims for the week ending Nov. 8 rose 109,000 to 4.01 million.

Early on Thursday, Saudi Prince Alwaleed bin Talal said that he is increasing his stake in Citigroup Inc. to 5%. The prince currently holds less than 4% in troubled bank. In a statement Prince Alwaleed said that began buying Citi shares, as he strongly believes that they are "dramatically undervalued." In regular trade on Wednesday, Citigroup (NYSE: C) plunged $1.91 or 22.85% to close at $6.45 after it announced that is buying $17.4 billion of remaining assets held by the structured investment vehicles, as the bank moves to unwind the troubled funds that it has been supporting since December 2007. A couple of days back, the company said that it's cutting 53,000 jobs in order to reduce costs. Shares of Citigroup rose over 3% in pre-market trade.

GMAC LLC, the financing arm of General Motors Corp.(NYSE: GM), has filed for status of a bank holding company in order to get access to the Treasury's $700 billion rescue fund for the financial industry. In a statement, the company said "as a bank holding company, GMAC would obtain increased flexibility and stability to fulfill its core mission of providing automotive and mortgage financing to consumers and businesses."GMAC said that if application is accepted, will become a Utah Chartered Federal Reserve Member Bank. GMAC also began an private exchange offer for $38 billion of debt issued by the company and its mortgage lending unit ResCap.

According to reports, diversified industrial firm General Electric (NYSE: GE) engaged in talks with at least foreign sovereign wealth funds on a possible equity holding and joint operations. Ferdinando Beccalli-Falco, head GE International, is reported to have said that the group is holding talks with the Singapore funds Temasek and GIC and with CIC and Safe of China. Additionally, the group is also holding "discussions" to find a partner in Germany in order to develop the US group's brands in Europe.
Shares of automakers will remain in focus on Thursday.

The chief executives of General Motors, Ford, Chrysler LLC returned for a second day on Capitol hill On Wednesday to plead for a $25 billion bridge loan. However, chances of automakers’ bailout are looking bleak as President Bush and majority of Republicans remain opposed to such a kind of rescue package. In pre-market trading, GM (NYSE: GM) lost over 10%.
Among other economic data, Leading Indicators and a regional manufacturing survey by Philadelphia Fed are scheduled to be released at 10:00 am ET.

European stocks were trading in red in afternoon trade. At 12:52 London time, the U.K. FTSE fell 72.83 points or 1.82% to 3,932. The German DAX and French CAC dropped 1.90% and 2.33% respectively.

Asian stocks finished with sharp losses on Thursday. The Nikkei 225 closed at 7703.04, down 570.18 points or 6.89%.  Hong Kong's Hang Seng Index fell 517.24 points or 4.04% to 12,298.56.
 
NYMEX Crude oil for December delivery dropped as much as much as $1.67, or 3.1%, to $51.95 a barrel.

Disclosure: Author does not own any of the stocks discussed here.