Inflation Data, Upbeat Earnings News May Lead To Initial Strength On Wall Street

(RTTNews) - The major U.S. index futures are currently pointing to a higher open on Friday, with stocks likely to extend the upward move seen over the course of the previous session.

The futures advanced following the release of a closely watched Labor Department report showing consumer prices in the U.S. increased by slightly less than expected in the month of September.

The Labor Department said its consumer price index rose by 0.3 percent in September after climbing by 0.4 percent in August. Economists had expected consumer prices to rise by another 0.4 percent.

The report also said the annual rate of growth by consumer prices ticked up to 3.0 percent in September from 2.9 percent in August, although that was slower than the 3.1 percent jump expected by economists.

Excluding food and energy prices, the core consumer price index crept up by 0.2 percent in September after rising by 0.3 percent in August. Core consumer prices were expected to increase by another 0.3 percent.

The Labor Department also said the annual rate of growth by consumer prices slowed to 3.0 percent in September from 3.1 percent August. Economists had expected the pace of growth to remain unchanged.

The relatively tame inflation data is likely to increase confidence the Federal Reserve will continue to lower interest rates in the coming months.

Early buying interest may also be generated in reaction to upbeat earnings news from big-name companies like Intel (INTC).

Shares of Intel are surging by 6.0 percent in pre-market trading after the semiconductor giant reported better than expected third quarter sales.

Auto giant (F) is also jumping by 3.6 percent in pre-market trading after reporting third quarter results that exceeded analyst estimates on both the top and bottom lines.

Shares of Procter & Gamble (PG) are also seeing notable pre-market strength after the consumer products giant reported fiscal first quarter results that exceeded expectations.

Following the weakness seen during Wednesday's session, stocks moved back to the upside during trading on Thursday. The major averages all moved higher on the day, with the tech-heavy Nasdaq showing a notable advance.

The major averages pulled back off their best levels going into the end of the day but remained in positive territory. The Nasdaq jumped 201.40 points or 0.9 percent to 22,941.80, the S&P 500 climbed 39.04 points or 0.6 percent to 6,738.44 and the Dow rose 144.20 points or 0.3 percent at 46,734.61.

Energy stocks saw substantial strength on the day as the price of crude oil skyrocketed after the Trump administration announced sanctions on Russia's two largest oil companies.

The Treasury Department announced sanctions against Rosneft and Lukoil, citing Russia's "lack of serious commitment to a peace process to end the war in Ukraine."

President Donald Trump recently expressed some optimism about ending the drawn-out Russia-Ukraine war before suddenly canceling a planned meeting with Russian President Vladimir Putin.

Reflecting the strength in the energy sector, the Philadelphia Oil Service Index spiked by 4.8 percent and the NYSE Arca Oil Index jumped by 3.0 percent.

Substantial strength was also visible among computer hardware stocks, as reflected by the 4.0 percent surge by the NYSE Arca Computer Hardware Index.

SanDisk (SNDK) helped lead the sector higher, with the data storage device maker soaring by 13.7 percent to a record closing high.

Networking, semiconductor and steel stocks also saw considerable strength on the day, while transportation stocks showed a notable move to the downside.

The strength on Wall Street came as the markets shrugged off an initially negative reaction to corporate earnings news from companies like Tesla (TSLA) and IBM Corp. (IBM).

Shares of Tesla showed a significant turnaround over the course of the session, jumping by 2.3 percent even though the electric vehicle maker reported weaker than expected third quarter earnings.

Tech giant IBM ended the day down by 0.8 percent but was well off its lows. The company reported third quarter earnings that exceeded analyst estimates but slowing growth in its core cloud computing business.

Meanwhile, shares of Honeywell (HON) shot up by 6.8 percent after the industrial giant reported third quarter results that beat analyst estimates on both the top and bottom lines.

In U.S. economic news, a report released by the National Association of Realtors showed existing home sales in the U.S. increased in line with economist estimates in the month of September.

NAR said existing home sales jumped by 1.5 percent to an annual rate of 4.06 million in September after dipping by 0.2 percent to an annual rate of 4.00 million in August. The rebound matched expectations.

Commodity, Currency Markets

Crude oil futures are climbing $0.40 to $62.19 a barrel after soaring $3.29 to $61.79 a barrel on Thursday. Meanwhile, after surging $80.20 to $4,145.60 an ounce in the previous session, gold futures are slumping $40.20 to $4,105.40 an ounce.

On the currency front, the U.S. dollar is trading at 152.49 yen versus the 152.58 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.1636 compared to yesterday's $1.1617.

Asia

Asian stocks rose on Friday ahead of pivotal talks between the United States and China in Malaysia to avert trade war escalation.

Beijing and Washington "can totally find ways to resolve each other's concerns," the Chinese commerce minister said after the White House confirmed plans for President Donald Trump to meet with Chinese leader Xi Jinping next week.

Investors also reacted to upbeat earnings results from U.S. chipmaker Intel and looked ahead to the release of the delayed inflation report from the U.S. later in the day for direction.

China's Shanghai Composite Index climbed 0.7 percent to 3,950.31 as investors braced for earnings from banking mainstays and industrial leaders.

Hong Kong's Hang Seng Index closed 0.7 percent higher at 26,160.15, with technology stocks leading the charge after China outlined a new five-year strategy to strengthen technological self-reliance and boost domestic demand.

Japanese markets rallied amid bets of new economic stimulus. Finance Minister Satsuki Katayama signaled the possibility of more government bond sales to fund Prime Minister Sanae Takaichi's upcoming economic package, if existing resources prove insufficient.

Investors also digested data that showed Japan's core inflation rate accelerated to 2.9 percent in September, matching the consensus estimate.

The Nikkei 225 Index jumped 1.4 percent to 49,299.65, while the broader Topix Index closed up 0.5 percent at 3,269.45.

Among the top gainers, technology investor SoftBank Group surged 5.7 percent and chip testing equipment maker Advantest rallied 3.7 percent.

Nidec lost 3.6 percent after the motor maker withdrew its full-year earnings guidance and suspended its share repurchase program that was announced on May 27.

Seoul stocks hit a new record high on optimism surrounding upcoming Trump-Xi meeting on the sidelines of the Asia-Pacific Economic Cooperation summit.

The South Korean won rose after the finance ministry pledged action if needed to curb volatility in the won-dollar trade.

The Kospi soared 2.5 percent to 3,941.59, led by tech shares and battery makers. Samsung Electronics rose 2.4 percent, SK Hynix surged 6.6 percent and LG Energy Solution soared almost 10 percent.

Australian markets ended slightly lower as investors braced for domestic and U.S. inflation data. The benchmark S&P/ASX 200 Index slipped 0.2 percent to 9,019, with financials and gold miners leading losses. The broader All Ordinaries Index closed down 0.1 percent at 9,317.20.

Across the Tasman, New Zealand's benchmark S&P/NZX-50 Index edged up by 0.1 percent to 13,391.59, extending gains from the previous session.

Europe

European stocks are turning in a mixed performance on Friday, as earnings proved to be a mixed bag and investors digest the release of delayed U.S. inflation figures for September.

Meanwhile, Eurozone business activity growth hit a 17-month high in October, with the Composite PMI rising to 52.2 from 51.2, driven by services.

The U.K. private sector grew faster than expected in the month, with S&P Global's Composite PMI rising to 51.1 from 50.1 the month before.

Elsewhere, data from the Office for National Statistics showed U.K. retail sales advanced 0.5 percent in September from the previous month, confounding expectations for a decline of 0.2 percent. The increase marked the fourth consecutive rise and took the total volume to the highest level since July 2022.

Separate survey results from market research group GfK showed that a measure of British consumer sentiment improved to -17 in October from -19 in September. Four measures were up and one was down from the previous month.

While the French CAC 40 Index is down by 0.3 percent, the U.K.'s FTSE 100 Index is up by 0.1 percent and the German DAX Index is up by 0.2 percent.

GSK has fallen after its anti-BCMA antibody drug conjugate Blenrep received FDA approval to return to the U.S. market but with significant restrictions.

Aerospace group Safran has also declined. The company raised its full year forecasts but warned of a residual hit from tariffs on its bottom line.

Signify, the world's biggest lights maker, has also slumped after it reported an 8.4 percent drop in its third-quarter sales.

Norwegian aluminum and renewable energy firm Norsk Hydro has also plunged after its third quarter adjusted earnings declined from last year.

On the other hand, Swedish defense and aerospace group Saab has moved sharply higher after lifting its full-year sales guidance.

NatWest has also moved to the upside. The lender upgraded its guidance after its third quarter profits jumped 35 percent compared to the same period last year.

Italian energy group Eni has also jumped. Citing improved outlook for cashflows, the company said it would increase its share buyback by 20 percent for the year.

French drug major Sanofi has also shown a notable advance after its third quarter results beat forecasts.

U.S. Economic News

A closely watched report released by the Labor Department on Friday showed consumer prices in the U.S. increased by slightly less than expected in the month of September.

The Labor Department said its consumer price index rose by 0.3 percent in September after climbing by 0.4 percent in August. Economists had expected consumer prices to rise by another 0.4 percent.

The report also said the annual rate of growth by consumer prices ticked up to 3.0 percent in September from 2.9 percent in August, although that was slower than the 3.1 percent jump expected by economists.

Excluding food and energy prices, the core consumer price index crept up by 0.2 percent in September after rising by 0.3 percent in August. Core consumer prices were expected to increase by another 0.3 percent.

The Labor Department also said the annual rate of growth by consumer prices slowed to 3.0 percent in September from 3.1 percent August. Economists had expected the pace of growth to remain unchanged.

At 10 am ET, the University of Michigan is scheduled to release its revised reading on consumer sentiment in the month of October. The consumer sentiment index for October is expected to be unrevised from the preliminary reading of 55.0, which was down slightly from 55. In September.