Futures Continue to Rise After GDP Revision
Stock index futures continued to point to a higher open after news the economy grew an estimated 3.1 percent in the fourth quarter, and as investors swapped concerns over Europe’s sovereign debt crisis and developments in the Middle East for optimism about earnings.
The second revision of U.S. economic growth by the Commerce Department was close to the initial reading of 3.1 percent made in January, but better than the 2.8 percent revision in February.
Technology stocks will continue to be in focus Friday. Research in Motiontumbled in after-hours trading Thursdayafter its outlook for the current quarter fell short of estimates, and its shares were downgraded by Bank of America Merrill Lynch, Deutsche Bank, and RW Baird.
But shares in Oracle rose after the company forecast a rise in sales of new software this quarter and hiked its dividend by a fifth.
In Europe, leaders were gearing up for a second day of meetings Friday after they agreed late on Thursday to expand the euro zone’s temporary bailout fund in June.
The European debt crisis has deepened with the collapse of Portugal’s government earlier this week, raising the specter of another bailout. European markets were nevertheless slightly higher in early trade, following Asian markets, which also rose.
In Japan, the situation at the Fukushima nuclear power plant remained worrisome, with officials saying one of the reactors may have experienced a serious breach of the core.
Rising oil prices, pushed up by unrest in the Middle East, could continue to weigh on stocks amid fears they will dent the economic recovery, although rising prices haven't been a big factor in the markets in recent days.
“$125-$150 (per barrel of) oil is going to weigh on the market, I think that goes without saying. For the most part we’ve been able to shrug off the European woes," Ben Lichtenstein, President of Tradersaudio.com told CNBC. Higher oil would however hurt the economy, he said.
Elsewhere in corporate news, Best Buy fell after Citi downgraded the electronics retailer to "sell," saying among several factors that the company's forecast was disappointing and "possibly too aggressive at the high end," including, among other things, that the company doesn't see earnings-per-share growth in the first half of 2012.
The University of Michigan index of consumer sentiment will be released at 9:55 a.m. A Briefing.com poll shows analysts expect a reading of 68.0 for March from 68.2 in February.
Philadelphia Federal President Charles Plosser speaks in New York at 12:15 p.m. at the Shadow Open Market Committee.
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