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U.S. equity futures extend gains in early Friday trading, putting the S&P 500 on pace to wipe out its decline for the week, following a tumultuous five-day stretch on Wall Street.
The S&P 500, the broadest measure of bluechip U.S. shares, suffered its biggest single-day decline in more than two years at the start of the week, while ending Thursday with its strongest advance since December as the unwinding of yen carry trades tore through global markets.
A better-than-expected reading for weekly jobless claims, which soothed concerns of a near-term recession tied to labor market weakness, supported yesterday’s rally, as did a near 10% surge for Eli Lilly (LLY) after its Streat-beating second quarter earnings.
The S&P 500 could end the week close to last Friday’s levels following an historic surge in market volatility triggered by the unwinding of leveraged currency trades.
Stocks are set to add to their recent run, potentially putting the S&P 500 back to the levels its closed at last Friday following a softer July payrolls report.
The CBOE Group’s VIX index, the market’s benchmark volatility gauge, eased to $23.25 in overnight trading, but remains at firmly elevated levels following its historic spike past the $60 mark earlier this week.
Benchmark 10-year Treasury note yields were holding steady at 3.959% heading into the start of the New York trading session, with 2-year notes pegged at 4.034%.
The U.S. dollar index, which tracks the greenback against a basket of six global currencies, was marked 0.01% lower at 103.195.
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Global oil prices, which have added to gains for much of the week amid rising geopolitical and military tensions in the Middle East, were holding steady as well, with WTI crude pegged at $76.25 per barrel.
Heading into the start of the trading day on Wall Street, the S&P 500, which is down 2.6% for the quarter, was priced for an opening bell gain of around 12 points while the Dow Jones Industrial Average was called 50 points higher.
The tech-focused Nasdaq, which is down 0.63% from last Friday’s close, is priced for a 60 point opening bell gain.
In Europe, the regional Stoxx 600 benchmark was also close to round-tripping its weekly declines, with an early gain of 0.84% in Frankfurt, while Britain’s FTSE 100 rose 0.47% in London.
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Overnight in Asia, a firmer reading for consumer price inflation in China eased deflation concerns, helping domestic stocks to solid Friday gains and lifting the region-wide MSCI ex-Japan benchmark to a 1.71% advance heading into the close of trading.
Japan’s Nikkei 225, meanwhile, closed 0.84% higher in Tokyo, pegging the benchmark’s weekly decline at just 0.63% following Monday’s 12.4% collapse, the largest since 1987.
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