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Futures Extend Gains After Durable Goods

U.S. stock index futures pointed to a higher open despite a report that durable goods orders fell more than expected, and ahead of an update on the housing sector and further signs of a potential economic recovery.

Durable goods for August fell 1.3 percent, from a revised 0.7 increase in July, the Commerce Department reported. Excluding transportation, durable goods rose 2.0 percent, more than expected, after falling 2.8 percent in July.

David Tepper of the hedge fund Appaloosa Management said on CNBC Friday that he's getting back into stocks, and added he's not interested in financials at the moment.

Tepper's bet on financial stocks at the bottom of the financial crisis helped to boost Appaloosa's 2010 returns to 132.7 percent, net of fees. Performance documents from an investor show the fund was up nearly 42 percent through July.

Tepper's comments helped to push futures prices higher, Art Cashin, director of floor operations at UBS Financial Services, said on CNBC.

"You could visibly see futures begin to move when Tepper said he was into stocks," Cashin said.

Other factors helping the market this morning: the sagging dollar, and its boost to multinational companies, the downsizing of the GM deal, and Petrobras' plans to raise $70 billion in what would be the biggest initial public offering in the world. The funds would allow Petrobas to tap offshore oil reserves.

A key economic indicator in Europe gave a boost to the euro but failed to lift European shares. German business sentiment rose unexpectedly in September, though companies now expect the pace of growth in Europe's largest economy to slow, the Munich-based Ifo, which carries out the monthly survey said.

Gold hit a new record highas fears of more quantitative easing causing volatility in currency markets increased. The yen fell sharply against the dollar on talk of intervention from the Japanese central bank.

August new home sales are due at 10 a.m. and are expected to rise by 291,000 purchases from 276,000 in July, when sales plummeted to the lowest level on record, Briefing.com said.

Investors will also be watching shares in Nike spacer, which reported results that beat Wall Street expectations Thursday after the bell. The world's largest athletic shoe-maker cited growing demand in North America, China, and emerging markets that helped lift quarterly earnings by 9 percent from a year ago.

Nike shares jumped in the premarket after the athletic clothing and shoe maker reported results that beat Wall Street expectations Thursday after the bell. Nike cited growing demand in North America, China, and emerging markets that helped lift quarterly earnings by 9 percent from a year ago.

Also in earnings news, KB Home's shares rose in the premarket after the homebuilder reported a narrower quarterly loss Friday as closings rose on homes ordered before the expiration of a federal tax credit.

Revenue rose 9 percent to $501 million. Chip maker Advanced Micro Devices late Thursday joined a list of tech companies warning on revenues this week. It said it expected third-quarter sales to fall due to weaker-than-expected demand, especially among consumers buying laptops in Western Europe and North America.

Bank of America Merrill Lynch hasincreased its share of deals in the mergers and acquisitions sector and it looks well place for further growth in Europe and Asia. Meanwhile, global M&A deals have come back this year, rising 21 percent so far, according to ThomsonReuters data.

Fed Chairman Ben Bernanke gives a lecture in Princeton at 4:30 pm. Analysts expect Fed speakers to drop hints on whether the Fed might move to quantitative easing after its next meeting on Nov. 3.