U.S. Stocks May Extend Rally On Upbeat Earnings, Retail Sales Data

Stocks are likely to move to the upside in early trading on Friday, extending the rally seen in the previous session. The major index futures are currently pointing to a higher open for the markets, with the Dow futures up by 172 points.

Another batch of upbeat earnings news is likely to contribute to continued strength on Wall Street, with financial giant Goldman Sachs (GS) reporting much better than expected third quarter results.

Buying interest may also be generated in reaction to a report from the Commerce Department showing an unexpected increase in U.S. retail sales in the month of September.

The report said retail sales climbed by 0.7 percent in September after jumping by an upwardly revised 0.9 percent in August.

The continued sales growth came as a surprise to economists, who had expected retail sales to edge down by 0.2 percent compared to the 0.7 percent increase originally reported for the previous month.

Excluding sales by motor vehicle and parts dealers, retail sales advanced by 0.8 percent in September after spiking by an upwardly revised 2.0 percent in August.

Economists had expected ex-auto sales to rise by 0.5 percent compared to the 1.8 percent jump originally reported for the previous month.

A separate report from the Labor Department showed import prices in the U.S. increased by less than expected in the month of September.

The Labor Department said import prices rose by 0.4 percent in September after dipping by 0.3 percent in August. Economists had expected import prices to climb by 0.6 percent.

Meanwhile, the report showed export prices inched up by 0.1 percent in September after rising by 0.4 percent in the previous month. Export prices were also expected to increase by 0.6 percent.

Shortly after the start of trading, the University of Michigan is scheduled to release its preliminary report on consumer sentiment in the month of October. The consumer sentiment index is expected to inch up to 73.1 in October from 72.8 in September.

Stocks moved sharply higher over the course of the trading session on Thursday, adding to the gains posted on Wednesday. With the strong upward move, the Dow ended the session at its best closing level in over a month.

The major averages ended the session just off their best levels of the day. The Dow jumped 534.75 points or 1.6 percent to 34,912.56, the Nasdaq surged 251.79 points or 1.7 percent to 14,832.43 and the S&P 500 shot up 74.46 points or 1.7 percent to 4,438.26.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Friday. Japan’s Nikkei 225 Index spiked by 1.8 percent, while China’s Shanghai Composite Index rose by 0.4 percent.

The major European markets have also moved to the upside on the day. While the U.K.’s FTSE 100 Index has edged up by 0.2 percent, the German DAX Index and the French CAC 40 Index are up by 0.5 percent and 0.6 percent, respectively.

In commodities trading, crude oil futures are rising $0.59 to $81.90 a barrel after climbing $0.87 to $81.31 a barrel on Thursday. Meanwhile, after edging up $3.20 to $1,797.90 an ounce in the previous session, gold futures are tumbling $24.60 to $1,773.30 an ounce.

On the currency front, the U.S. dollar is trading at 114.34 yen versus the 113.68 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.1601 compared to yesterday’s $1.1597.