While stocks ended the previous session well off their early highs, buying interest appears poised to re-emerge in early trading on Friday. The major index futures are currently pointing to a sharply higher open for the markets, with the Dow futures up by 196 points.
Optimism about Greece is likely to contribute to early strength on Wall Street, as traders hope the debt-laden nation will finally be able to reach a new agreement with its creditors.
In a move seen as Greece's final bid to remain in the eurozone, the government offered a cash-for-reforms proposal to creditors that comprises spending cuts and tax hikes in exchange for a third bailout.
Prime Minister Alexis Tsipras' request for at least 53.5 billion euros in bailout funds for the next three years will be presented in the Greek parliament for approval on Friday.
Eurozone finance ministers will meet on Saturday in Brussels to review the Greek request, followed by a summit of European leaders on Sunday to reach a final agreement.
"The realistic proposal from Greece will have to be matched by an equally realistic proposal on debt sustainability from the creditors," European Union President Donald Tusk told reporters. "Only then will we have a win-win situation."
The latest proposal offered by Athens includes a value added tax hike and spending cuts on pensions. It also includes a timetable for privatizations.
Early buying interest may also be generated by a continued rebound by the Chinese stock markets, as the Shanghai Composite Index jumped by 4.5 percent following yesterday's 5.8 percent gain.
Chinese stocks benefited from expectations the country's central bank will unveil further measures to support the market over the weekend.
Later in the day, trading could be impacted by remarks by Federal Reserve Chair Janet Yellen, who is due to deliver a speech about the U.S. economic outlook in Cleveland, Ohio.
Traders are likely to keep a close eye on Yellen's remarks for any indications regarding the timing of the first interest rate hike.
Specific mentions of the turmoil in Greece and China could add to recent speculation that the Fed intends to delay raising rates.
After moving sharply higher at the open, stocks gave back ground over the course of the trading day on Thursday but managed to close modestly higher. The gains on the day came on the heels of the sell-off that was seen in the previous session.
The major averages closed in positive territory but well off their best levels of the day. The Dow crept up 33.20 points or 0.2 percent to 17,548.62, the Nasdaq rose 12.64 points or 0.3 percent to 4,922.40 and the S&P 500 edged up 4.63 points or 0.2 percent to 2,051.31.
In overseas trading, most stock markets across the Asia-Pacific region saw continued strength on Friday. Hong Kong's Hang Seng Index jumped by 2.1 percent, and Australia's All Ordinaries Index rose by 0.4 percent. However, Japan's Nikkei 225 Index bucked the uptrend and fell 0.4 percent.
The major European markets are seeing considerable strength amid optimism about a Greek deal. While the U.K.'s FTSE 100 Index has surged up by 1.5 percent, the German DAX Index is up by 2.4 percent and the French CAC 40 Index is up by 3.3 percent.
In commodities trading, crude oil futures are climbing $0.46 to $53.24 a barrel after jumping $1.13 to $52.78 a barrel on Thursday. Meanwhile, an ounce of gold is currently trading at $1,160.60, up $1.40 from the previous session's close of $1,159.20. On Thursday, gold fell $4.30.
On the currency front, the U.S. dollar is trading at 122.40 yen compared to the 121.34 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.1186 compared to yesterday's $1.1036.
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