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Economic Data, Earnings News In Focus On Wall Street

The major U.S. index futures are pointing to a mixed opening on Friday following the strong upward move seen in the previous session.

Early trading is likely to be impacted by reaction to closely watched reports on retail sales and consumer prices as well as earnings news from financial giants JPMorgan Chase (JPM) and Wells Fargo (WFC).

Stocks moved notably higher over the course of the trading day on Thursday, more than offsetting the modest pullback seen on Wednesday. With the upward move, the major averages climbed to new record closing highs.

The major averages saw further upside going into the close, ending the session at their best levels of the day. The Dow jumped 205.60 points or 0.8 percent to 25,574.73, the Nasdaq advanced 58.21 points or 0.8 percent to 7,211.78 and the S&P 500 climbed 19.33 points or 0.7 percent to 2,767.56.

The rebound on Wall Street was partly due to easing concerns about treasuries after China dismissed a Bloomberg News report that officials have recommended slowing or halting purchases of U.S. debt.

"The news could quote the wrong source of information, or may be fake news," China's State Administration of Foreign Exchange said, according to Reuters.

The SAFE said China has been diversifying its foreign currency reserves investments to help "safeguard the overall safety of foreign exchange assets and preserve and increase their value."

Meanwhile, traders largely shrugged off a report from the Labor Department showing another unexpected increase in first-time claims for U.S. unemployment benefits.

The report said initial jobless claims rose to 261,000 in the week ended January 6th, an increase of 11,000 from the previous week's unrevised level of 250,000.

The modest increase came as a surprise to economists, who had expected initial jobless claims to edge down to 245,000.

A separate report from the Labor Department unexpectedly showed a modest decrease in producer prices in the month of December.

The Labor Department said its producer price index for final demand edged down by 0.1 percent in December after climbing by 0.4 percent in November. Economists had expected prices to rise by 0.2 percent.

Excluding food and energy prices, core producer prices still dipped by 0.1 percent in December following a 0.3 percent increase in November. Core prices had also been expected to tick up by 0.2 percent.

Airline stocks showed a particularly strong move to the upside on the day, adding to the gains posted in the previous session. The NYSE Arca Airline Index surged up by 3.9 percent to its best closing level in nearly six months.

Within the airline sector, Delta Air Lines (DAL) posted a notable gain after beating fourth quarter expectations and raising its 2018 earnings guidance.

Significant strength was also visible among energy stocks, which benefited from a continued increase by the price of crude oil.

Reflecting the strength in the energy sector, the Philadelphia Oil Service Index and the Natural Gas Index jumped by 2.4 percent and 2.3 percent, respectively, and the NYSE Arca Oil & Gas Index advanced by 1.9 percent.

Steel, trucking, housing and computer hardware stocks also saw considerable strength, moving higher along with most of the other major sectors.

Commodity, Currency Markets

Crude oil futures are sliding $0.58 to $63.22 a barrel after rising $0.23 to $63.80 a barrel on Thursday. Meanwhile, after climbing $3.20 to $1,322.50 an ounce in the previous session, gold futures are up $4.30 at $1,326.80 an ounce.

On the currency front, the U.S. dollar is trading at 111.52 yen compared to the 111.26 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.2128 compared to yesterday's $1.2032.

Asia

Asian stocks closed mostly higher on Friday after oil prices moved higher overnight and China dismissed media reports that officials have recommended slowing or halting purchases of U.S. debt. Optimism about the earnings season also offered some support.

Chinese shares closed higher for the eleventh straight session as investors looked past soft trade data. The benchmark Shanghai Composite index edged up 3.97 points or 0.1 percent to 3,429.32, while Hong Kong's Hang Seng Index advanced 292.15 points or 0.9 percent to 31,412.54.

Official data showed that Chinese import and export growth slowed in December in a sign of weaker global and domestic demand.

December exports grew an annual 10.9 percent, beating forecasts but down from a robust 12.3 percent gain in November. Imports grew at an even slower pace of 4.5 percent.

Australian shares finished marginally higher after two days of losses as miners gained ground, offsetting declines in the financial and retail sectors.

BHP Billiton, Rio Tinto, Fortescue Metals Group and South32 climbed 2-4 percent despite a decline in iron ore prices.

Gold miners Regis Resources, Evolution and Northern Star rallied 1-2 percent after gold prices rose overnight for their highest settlement price since September.

Banks ANZ, Commonwealth and Westpac fell between 0.4 percent and 0.7 percent, while energy stocks closed on a mixed note.

Retailers Woolworths and Wesfarmers ended in the red, but JB Hi-Fi continued its strong run to end 1.3 percent higher after a brokerage upgrade.

Meanwhile, Japanese shares ended lower as the yen's recent strength hurt exporters. Uniqlo-owner Fast Retailing posted a record quarterly profit, helping limit the downside.

The Nikkei 225 Index dropped 56.61 points or 0.2 percent to 23,653.82, while the broader Topix index closed 0.6 percent lower at 1,876.24.

Heavyweight Fast Retailing soared 6 percent after its first quarter operating profit topped forecasts. Among exporters, Sony, Canon, Panasonic, Honda Motor and Kyocera fell 1-2 percent.

On the economic front, Japan logged a current account surplus of 1.35 trillion yen in November, the government said in a report, down 5.6 percent from a year earlier.

Europe

European stocks are little changed on Friday as the euro continued its ascent against the dollar to hit a three-year high amid signs that the European Central Bank may wind down its 2.55 trillion euro ($3.07 trillion) bond purchase scheme this year.

German politicians reached a breakthrough in talks aimed at forming a new coalition government, helping support underlying sentiment to some extent.

While the German DAX Index has edged down by 0.1 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index are both up by 0.2 percent.

In economic news, French consumer prices increased at a steady pace in December, final data from statistical office Insee showed.

Consumer price inflation climbed an annual 1.2 percent in December, the same pace as seen in November and in line with the flash estimate.

Technology company Smiths Group has rallied in London after the company said the net impact of the new U.S. tax legislation would be favorable for the company over the medium term.

GKN has also soared after the British engineering and aerospace group rejected a 7 billion pound takeover bid from Melrose.

Fiat Chrysler Automobiles NV has rallied after the automaker unveiled plans to shift production of Ram heavy-duty pickup trucks from Mexico to Michigan in 2020.

Meanwhile, Kering shares have fallen after the French luxury goods company said that it proposes to distribute PUMA shares to shareholders through a distribution in kind.

Societe Generale has also declined after the French bank said U.S. tax reform would result in a charge of $307 million to be recorded in the fourth quarter of 2017.

Germany's Bayer has dropped after reducing its direct interest in Covestro from 24.6 percent to 14.2 percent.

U.S. Economic Reports

A report released by the Commerce Department showed U.S. retail sales rose in line with economist estimates in the month of December.

The Commerce Department said retail sales increased by 0.4 percent in December after climbing by an upwardly revised 0.9 percent in November.

Economists had expected retail sales to rise by 0.4 percent compared to the 0.8 percent increase originally reported for the previous month.

Excluding auto sales, retail sales still rose by 0.4 percent in December after jumping by 1.3 percent in November. The increase in ex-auto sales also matched estimates.

A separate report from the Labor Department showed consumer prices rose by less than expected in December, reflecting a sharp pullback in energy prices.

The Labor Department said its consumer price index inched up by 0.1 percent in December after climbing by 0.4 in November. Economists had expected prices to rise by 0.2 percent.

Meanwhile, the report said core consumer prices, which exclude food and energy prices, increased by 0.3 percent in December after ticking up by 0.1 percent in November. Core prices had been expected to rise by 0.2 percent.

At 10 am ET, the Commerce Department is scheduled to release its report on business inventories in the month of November. Inventories are expected to rise by 0.3 percent.

Philadelphia Federal Reserve President Patrick Harker is due to speak at the Central Bucks Chamber of Commerce Economic Luncheon in Ivyland, Pennsylvania, at 12:30 pm ET.

At 4:15 pm ET, Boston Fed President Eric Rosengren is scheduled to give the keynote address at the Global Interdependence Center and University of California, San Diego Conference on Money, Models, and Digital Innovation in La Jolla, California.

Stocks In Focus

Shares of BlackRock (BLK) are moving higher in pre-market trading after the asset management company reported better than expected fourth quarter results and raised its quarterly dividend.

Regional bank PNC Financial (PNC) may also see early strength after reporting adjusted fourth quarter earnings that beat analyst estimates.

Shares of JPMorgan are modestly higher in pre-market trading after the financial giant reported better than expected fourth quarter results. The company recorded a $2.4 billion charge related to the new tax law.

On the other hand, Wells Fargo may move to the downside despite reporting fourth quarter earnings that appeared to exceed analyst estimates. The results included a $3.35 billion after-tax benefit from tax reform.

Shares of American Express (AXP) could also see early weakness after JPMorgan downgraded its rating on the credit card giant to Neutral from Overweight.

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