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US stock futures edge higher; strong earnings boost sentiment By Investing.com

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Investing.com– U.S. stock index futures rose Friday, continuing the recent positive trend based on a strong earnings season and hopes for monetary easing.

At 06:10 ET (10:10 GMT), rose 125 points, or 0.3%, gained 19 points, or 0.4%, and climbed 85 points, or 0.5%. 

The main Wall Street indexes rose on Thursday, with the recording a seventh straight day of gains, its best showing since December. This index is on course to gain 1.8% this week, while the is set to register an increase of 1.7% and the 1.2%.  

Cooling labor market points to rate cuts

Helping the tone Thursday was a bigger-than-expected increase in weekly , which furthered expectations of a cooling labor market.

The data came nearly a week after a substantially softer-than-expected reading, and raised hope that the U.S. Federal Reserve will start cutting interest rates later this year.

Fed Chair Jerome Powell last week basically ruled out the next move being a hike, and although Fed officials have warned about inflation being too high, investors have largely maintained bets that the Federal Reserve will start cutting interest rates by September.

The showed traders pricing in a nearly 50% chance the Fed will cut rates by 25 basis points in September. 

That said, sticky inflation remains a point of concern, putting the focus squarely on a inflation reading for April, due next week. The reading is expected to moderate after overheated prints for the past three months, but is still likely to remain above the Fed’s 2% target.

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A slate of central bank officials are scheduled to speak Friday, including Fed presidents of Dallas, of Minneapolis and of Chicago.

The preliminary reading of the University of Michigan’s for May is the highlight an otherwise quiet day on the economic calendar on Friday.

Positive earnings season

Helping the overall tone has been a generally strong earnings season.

Well over 80% of the S&P 500 have reported first quarter results, and companies are on track to have increased earnings by 7.8%, up from an expectation of 5.1% growth in April, according to LSEG IBES.

That said, cloud services firm Akamai Technologies (NASDAQ:) fell 10% after posting disappointing guidance for the current quarter and for 2024.

Videogame software developer Unity Software (NYSE:) fell nearly 3% after its quarterly earnings per share missed estimates. 

The electric vehicle market is likely to be in the spotlight Friday following reports that the U.S. was preparing more tariffs against Chinese companies, that were specifically aimed at EVs and other key sectors.

Oil set for weekly gain

Crude prices rose Friday, on track for a weekly gain, after this week’s data from the U.S. and China — the world’s two largest crude users — pointed to higher demand.

 

By 10:10 ET, the U.S. crude futures traded 0.7% higher at $79.80 per barrel, while the Brent contract climbed 0.6% to $84.36 a barrel.

Both contracts were on pace to gain about 2% each this week after suffering steep losses in the prior week.

Stronger-than-projected overall import data from China, the world’s biggest oil importer, coupled with a fall in inventories, has raised hopes that global oil demand was improving.

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(Ambar Warrick contributed to this article.)



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