Stock index futures added to gains Friday after economic reports showed stronger than expected retail sales in November while inflation remained tame.
The Commerce Department said retail sales rose 1.3 percent last month, more than double the 0.6 percent increase economists had expected. Excluding autos, retail sales jumped 1.2 percent, triple the 0.4 percent advance economists expected.
At the same time, the Labor Department said import prices rose 1.7 percent for November, a bit higher than expected but attributed primarily to fuel costs.
Futures previously gained comments from Moody's on the US debt rating and bullish guidance from United Technologies. Dow futures were about 50 points above fair value, 10 points higher than before the retail and inflation data.
Two straight days of gains have put Wall Street's major averages near breakeven for the week, so Friday's action will determine whether the Dow, the S&P 500, and the Nasdaq can chalk up their second consecutive weekly gains.
Moody's said the top credit ratings for the U.S. and Britain are not under threat of a downgrade at the moment, though a worst-case scenario could see a cut by 2013. Moody's classifies the U.S. and the U.K. as "resilient" rather than "resistant."
Dow component UTX said after the bell Thursday it expects profits to grow in 2010 after declining this year. The company's projected revenue was above Wall Street's most recent estimates, while the top of its projected earnings per share is also above estimates.
Positive sentiment is also surrounding Dow component Boeing, which says its long awaited 787 Dreamliner aircraft could have its first test flight on December 15.
In the financial space, ING Group said it will repay about $8.27 billion in aid to the Dutch government, about half of what it received during the financial crisis. The Dutch banking and insurance firm saw its US-traded shares gain 4.8 percent in premarket trading.
Shares of Yahoo also rose, gaining about 2 percent after Kaufman Brothers upgraded the company to "buy."
Two economic reports will also help shape the market's mood. The government releases November retail sales at 8:30 am New York time, with economists looking for a rise of 0.7 percent, following a 1.4 percent gain in October. When autos are factored out, consensus calls for a 0.4 percent gain for November.
At 9:55 am, the University of Michigan releases its latest consumer sentiment index, with economists looking for a slight gain to 68.3 for December's preliminary reading, following a final 67.4 reading for November.
The latest data on import and export prices also will be released at 8:30, with the government releasing October business inventories at 10 am.
In the news: the House is moving towards final passage of a sweeping financial regulation overhaul bill. Final votes could come today.