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Stocks May See Further Upside In Early Trading - U.S. Commentary

2/24/2012 8:57 AM ET

After turning higher over the course of the previous session, stocks could see some further upside in early trading on Friday. The major index futures are currently pointing to a modestly higher open for the markets, with the Dow futures up by 15 points.

The markets may benefit from recent optimism about the outlook for the U.S. economy as well as easing concerns about the financial situation in Europe.

Nonetheless, buying interest may be somewhat subdued, as traders question whether the global economic situation supports further upside for the markets. Specifically, the Dow may face resistance near the key 13,000 level.

Shortly after the open, trading could be impacted by the release of Reuters and the University of Michigan's final report on consumer sentiment in the month of February. The consumer sentiment index for February is expected to be upwardly revised to 73.0 from the preliminary reading of 72.5.

The Commerce Department is also scheduled to release its report on new home sales in the month of January. Economists expect new home sales to increase to an annual rate of 315,000 in January from 307,000 in December.

In corporate news, shares of J.C. Penney (JCP) may be in focus after the department store operator reported a fourth quarter loss compared to a year-ago profit. Excluding restructuring charges, however, the company reported a profit that exceeded analyst estimates.

Financial giant Citigroup (C) may also attract attention after announcing that it has sold its 9.85 percent stake in Indian mortgage lender HDFC Ltd. for $1.9 billion at the current exchange rate. The company said it expects an after-tax gain of approximately $722 million.

With upbeat jobs data overshadowing some disappointing earnings news, stocks moved higher over the course of the trading day on Thursday.

The major averages recovered from early weakness, but the Dow was unable to cross the 13,000 level. The Dow rose 46.02 points or 0.4 percent to 12,984.69, the Nasdaq jumped 23.81 points or 0.8 percent to 2,956.98 and the S&P 500 climbed 5.80 points or 0.4 percent to 1,363.46.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher over the course of the trading day on Friday. Japan's Nikkei 225 Index rose by 0.5 percent, while Hong Kong's Hang Seng Index edged up by 0.1 percent.

Meanwhile, the major European markets have turned mixed on the day. While the U.K.'s FTSE 100 Index has dipped just below the unchanged, the French CAC 40 Index and the German DAX Index are both up by 0.5 percent.

In commodities trading, crude oil futures are climbing $0.43 to $108.26 a barrel after advancing $1.55 to $107.83 a barrel on Thursday. Gold futures, which rose $15 to $1,786.30 an ounce in the previous session, are slipping $5 to $1,781.30 an ounce.

On the currency front, the U.S. dollar is trading at 80.55 yen compared to the 79.9965 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.3416 compared to yesterday's $1.3373.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

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