Market Insider/Friday Look Ahead

Some big earnings reports and the afterglow of Google's solid profit reportwill compete with worries about credit issues and the background chatter of G-7 officials Friday.

The U.S. dollar's record-setting slide and oil's record-setting rise will also be a focus. Oil broke through a record $90 per barrel in electronic trading Thursday evening. Fingers crossed, it is also the twentieth anniversary of the 1987 stock market crash.

Already comments from the G-7 meetings in Washington have markets moving. On Thursday, Bank of Japan Governor Toshihiko Fukui said problems from the U.S. subprime mortgage losses have increased uncertainty in financial markets. No kidding, but those words apparently weighed on Asian stock markets.

The G-7 usually generates a few headlines but this meeting takes on a special importance because of its timing. The dollar's decline is beginning to cause concern among some exporting countries. Unease in financial markets and the continued risks to markets will certainly be a topic. Add to that trade issues, and the meetings could generate a few headlines the markets will care about.

On Friday, speakers include Wu Xiaoling, deputy governor of the People's Bank of China. At 7 p. EST, Treasury Secretary Hank Paulson speaks. Kudlow and Co will have full coverage Friday evening, and CNBC's Steve Liesman will report from Washington.

Around the World
Markets have been highly sensitive to developments around the world this week. Oil has been particularly impacted by the tensions between Turkey and Kurds in Northern Iraq. Traders have also watched efforts to contain Iran's nuclear program, and now the attempted assassination attempt against former Pakistani prime minister Benazir Bhutto on her return home from exile raises fears about stability in that part of the world.

Earnings CentralOn the earnings front, good news from Google may be a catalyst for the Nasdaq tomorrow. Google's third-quarter profit jumped 46 percent to $1.07 billion on revenues of $4.23 billion. Honeywell , Caterpillar and 3M report earnings before the bell Friday.

Calming Credit
A relief to the credit markets may be a report in the Wall Street Journal that Citigroup secured funding through the end of the year for $80 billion in structured investment vehicles(SIVs) it manages. This is good news because those SiVs will now not be faced with forced selling, which would have guaranteed losses. The Journal quotes Citigroup's John Havens as saying Citi SIVs have in the past week been able to sell "many billions of dollars" in short term debt, or commercial paper to what he described as" top-tier name institutions."

This is important because the credit markets have been gripped with fear this week, resulting in an intense flight-to-quality trade in Treasurys in the past two days. The negative sentiment seems to have started shortly after the unveiling of a plan by Citi, Bank of American and J.P. Morgan to create a super fund for mortgage debt and other securities. The plan was announced Monday and has since been met with skepticism.

Meanwhile, shakeout in the commercial paper market continues. Two European funds were forced to begin selling assets. The Wall Street Journal said they had a combined $16 billion in assets last summer. They are Dutch Radobank's Tango Finance, one of the world's larges SIVs, and Rhinebridge, run by Germany's IKB Deutsche Industriebank AG.

SIVs are off-balance sheet funds that make money issuing short-term debt to buy long-term, higher yielding assets. Demand for the short-term debt evaporated this summer, as investors were unwilling to buy debt that might be backed by bad mortgages.

Flight To Quality
In a day of heavy buying, the 10-year finished Thursday with a yield of 4.504% and the two year yield fell to 3.919%.

If the flight to quality in Treasurys continues, CNBC's Rick Santelli says the stock market could start to show signs of wear on concerns about credit issues. "If we see interest rates on the two-year note get back up toward 4%, then I think equities will be ok," said Santelli.

The Dow Thursday finished down 3.58 points, its fourth down day in a row. That gives the Dow its longest losing streak since Aug. 16 when the index was down six days in a row. The Nasdaq rose 6 points, and the S&P 500 lost 1 point.

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