Dow Futures Rise 115 Pts; Ending Losing Week on Positive Note

U.S. stocks are seen opening marginally higher Friday, continuing the previous session’s rebound as investors sought bargains after expectations of aggressive Federal Reserve interest rate increases had weighed.

At 7 AM ET (1100 GMT), the Dow Futures contract was up 115 points, or 0.3%, S&P 500 Futures traded 13 points, or 0.3%, higher and Nasdaq 100 Futures climbed 40 points, or 0.3%.

The main Wall Street indices closed higher Thursday, with the blue chip Dow Jones Industrial Average climbing nearly 100 points, or 0.3%, helped by dip buying investors seeking value after digesting the likelihood of tighter monetary policy from the U.S. central bank.

However, these averages are still set for a lower week, with the Dow currently heading for a drop of 0.7%, the S&P 500 a loss of 1% and the Nasdaq Composite down 2.6%.

The minutes from the Federal Reserve meeting in March, the gathering which saw the U.S. central bank hike interest rates for the first time since 2018, added to recent comments from a number of policymakers that indicated hefty interest rate increases were on the way.

St. Louis Fed President “James Bullard doubled down on his recent hawkish statements by calling for up to 300bp of tightening this year,” said ING analysts, in a note.

The new quarterly earnings season starts next week, kicking off with reports from the banking sector. JPMorgan (NYSE:JPM) will report before the bell on Wednesday, while Citigroup (NYSE:C), Goldman Sachs (NYSE:GS), Morgan Stanley (NYSE:MS) and Wells Fargo (NYSE:WFC) will report before the open on Thursday.

The major lenders are set to show a sharp decline in first quarter earnings from a year ago, when they benefited from exceptionally strong dealmaking and trading, but investors are likely to focus more on the chances of increased net interest income, as the banks benefit from higher interest rates.

There is little in the way of major economic data scheduled for Friday, and investors may instead focus on events in Ukraine following reports of many deaths as a result of a Russian rocket strike on a railway station in the east of the country.

The U.S. Congress removed its “most favored nation” trade status on Russia on Thursday following previous allegations of atrocities by Russian troops on Ukrainian civilians.

Oil prices stabilized Friday but are still heading for hefty weekly losses, weighed by the decision of a number of major consuming nations to release massive amounts of crude from emergency reserves as well as China’s worsening demand outlook as its Covid outbreak persists.

International Energy Agency member countries announced earlier this week that they would release 60 million barrels of oil, adding to the 180 million barrel release announced by the United States last week, while China announced over 21,000 new Covid cases on Thursday.

By 7 AM ET, U.S. crude futures traded 0.1% higher at $96.09 a barrel, on course for a loss of 3.2% this week, while the Brent contract fell 0.2% to $100.35, down 3.9% so far this week.

Additionally, gold futures fell 0.2% to $1,933.40/oz, while EUR/USD traded 0.1% higher at 1.0884.