Friday October 16th

16-10-2015

Wall Street looks to data and earnings

U.S. stock index futures indicated a flat to slightly higher open on Friday, with traders keenly anticipating the release of economic data for any signs of softness that would reinforce the pervading view that the Fed is on hold for now. Stocks surged Thursday amid speculation the Fed would not hike rates until sometime next year, with weak economic reports feeding that view. The market got a nudge from a comment by New York Fed President Bill Dudley, who said he would favor a rate hike this year, but it depends on the strength of the economy. He then added that recent data indicates the economy is slowing. On the data front, Friday will see both industrial production and capacity utilization released at 9:15 a.m. ET, with consumer sentiment and the job openings and labor turnover survey, or JOLTs, released at 10:00 a.m. On the earnings front, General Electric posted earnings per share above expectations, but revenues fell short of estimates. Honeywell, Comerica, Kansas City Southern, SunTrust, Synchrony Financial and W.W. Grainger also reported before the bell. In Europe, the pan-European Stoxx 600 index held about half a percent higher ahead of the U.S. market open. Asian equities cruised higher on Friday, thanks to an encouraging lead from Wall Street and as investors bet on the possibility of further stimulus measures from Japan and China. Major U.S. averages rallied more than 1 percent overnight, thanks to a jump in financials and soft economic data that bolstered the case for a delay in the rise of U.S. interest rates. Share markets in China lurched higher in the final hour of trading, with the key Shanghai Composite rallying 1.6 percent. Nikkei up 1.1%. Japan's Nikkei 225 index extended gains on the back of heightened expectations for further Bank of Japan (BOJ) stimulus. Oil prices steadied on Friday, snapping a week-long decline as investors closed positions at the end of a volatile week that saw prices slide nearly 10 percent on renewed signs a global supply glut was here to stay. Brent's new front-month December contract was up 19 cents at $49.92 a barrel at 7:58 a.m. (1158 GMT). November Brent expired at $48.71 a barrel on Thursday, down 44 cents day on day. U.S. crude's front-month November contract traded 38 cents higher at $46.76 a barrel. Gold fell on Friday as a recovering dollar pulled prices from 3-1/2 month highs, but doubts over whether the Federal Reserve will press ahead with a U.S. rate rise this year kept the metal on track for a second weekly rise. Prices continued a retreat that began on Thursday after upbeat U.S. inflation data calmed some concerns about the strength of the U.S. economy and boosted the dollar. Spot gold was down 0.06 percent at $1,181.90 an ounce, while U.S. gold futures for December delivery were down $5.50 an ounce at $1,182. Spot gold is on track to rise 2 percent this week after peaking at $1,190 an ounce, its strongest since late June.