Top 5 Things to Know in the Market on Friday

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 Top 5 Things to Know in the Market on Friday
Credit: © Reuters.

Investing.com - Here are the top five things you need to know in financial markets on Friday, October 27:

1. U.S. GDP expected to see hurricane-induced slowdown

The U.S. is to release preliminary figures on third-quarter gross domestic product (GDP) at 8:30AM ET (12:30GMT) Friday.

The report is expected to show growth slowing to an annual rate of 2.6% from 3.1%, with a decline in retail sales, industrial production, homebuilding and home sales blamed on Hurricanes Harvey and Irma.

Investors will also keep an eye on a revision to Michigan’s consumer sentiment index for October, set for release at 10:00AM ET (14:00GMT).

2. Dollar continues rally to 3-month high ahead of GDP

The dollar continued a rally against major rivals that began on Thursday as the U.S. House passed a budget resolution, fueling hopes that Congress will move forward on “massive tax cuts” proposed by President Donald Trump.

Flight from the euro also lent strength to the greenback after the European Central Bank’s decision to pare its bond purchases but extended the program for at least an additional nine months through September of next year.

Speculation over what would be Trump’s choice for Federal Reserve chair also fueled gains in the dollar.

Latest reports have suggested that the President is focused on deciding between Fed governor Jerome Powell and Stanford University economist John Taylor.

The latter is generally considered to be the most hawkish among the five candidates on Trump’s shortlist.

While waiting for the GDP data, he U.S. dollar index , which measures the greenback’s strength against a trade-weighted basket of six major currencies, gained 0.18% at 94.72 by 6:01AM ET (10:01GMT), hitting its highest level since mid-July, as gold futures for December delivery on the Comex division of the New York Mercantile Exchange showed choppy trade around the unchanged mark at three-week highs.

3. Tech earnings pump risk appetite

A slew of earnings from tech giants released after Thursday’s U.S. market close were well received by market participants and pointed to solid gains in pre-market trade on Friday.

Shares in Amazon (NASDAQ: AMZN ) surged 7%, leading the pack, after the online retailer saw sales surge in its recent quarterly results, while the firm was also on watch on reports that it could be moving to become a pharmaceutical distributor.

Microsoft (NASDAQ: MSFT ) saw gains of 4% after the firm beat profit estimates on gains from cloud services.

Google’s parent Alphabet (NASDAQ: GOOGL ) followed with gains of 3% after the internet giant reported a surge in ad volumes during the third quarter.

Shares in Intel (NASDAQ: INTC ) rose more than 2% after the tech firm lifted full year forecasts on data center strength.

Outside of tech, Chevron (NYSE: CVX ), Exxon (NYSE: XOM ) and Colgate-Palmolive (NYSE: CL ) will be among firms on earnings watch as they release quarterly earnings before Friday’s opening bell.

4. Global stocks trade higher on tech surge

U.S. futures pointed to a higher open on Friday as investors celebrated the better-than-expected tech earnings released after the prior close and investors looked ahead to more results from blue-chip oil companies and the latest reading on the stated of economic growth stateside. At 6:01AM ET (10:01GMT), the blue-chip Dow futures rose 45 points, or 0.19%, S&P 500 futures gained 7 points, or 0.27%, while the Nasdaq 100 futures traded up 32 points, or 0.52%.

Elsewhere, European equities were mostly higher on Friday after positive earnings from the region with shares continuing to rally on investors’ dovish read of the ECB decision released a day earlier. A notable exception was Spain’s IBEX 35 as the country continues to wade through the political crisis with the Catalan region’s desire for independence.

Earlier, Asian shares gained on Friday as technology stocks were boosted by upbeat earnings from U.S. high-tech giants and a stronger dollar lifted sentiment for exporters. Japan’s Nikkei ended 1.2% higher while China’s Shanghai Composite pocketed gains of around 0.3%.

5. Oil on track for 2% weekly gains ahead of U.S. shale data

Oil prices saw investors take profits on Friday, though U.S. crude was on track for weekly gains of around 2% on hopes that OPEC could announce an extension of the agreement to curb production.

Crude had jumped nearly 1% on Thursday as Saudi Arabia’s Crown Prince Mohammed bin Salman backed the extension of the deal set to expire in March 2018.

OPEC will hold an official meeting where they could discuss the proposal in November.

Market participants will also keep an eye on increasing U.S. shale production when Baker Hughes releases its most recent weekly rig count data later on Friday.

Last week the oilfield services firm said that its weekly count of oil rigs operating in the U.S. fell by seven to 736, chalking up its third straight decline to the lowest level since June.

U.S. crude oil futures fell 0.21% to $52.53 at 6:02AM ET (10:02GMT), while Brent oil traded down 0.29% to $59.13.

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