By Carla Mozee, MarketWatch
LONDON (MarketWatch) -- U.S. stocks look set to advance Friday
and win back a portion of Thursday's Portugal-induced losses, while
banking heavyweight Wells Fargo & Co. is expected to extend a
run of rising profit.
Investors also will monitor appearances by three Federal Reserve
speakers for any comments they may make about the future of
interest rates.
Futures for the Dow Jones Industrial Average (DJU4) rose 28
points, or 0.2%, to 16,870, while those for the S&P 500 index
(SPU4) gained 3.6 points, or 0.2%, to 1,961.40. The Nasdaq 100
index (NDU4) tacked on 12 points, or 0.3%, to 3,885.50.
Second-quarter results from Wells Fargo & Co. (WFC) are
expected to arrive ahead of the opening bell. Earnings at the
U.S.'s largest mortgage provider are expected to come in at $1.01 a
share. That would compare with 98 cents a share in the year-ago
period, according to analysts surveyed by FactSet. Wells Fargo has
had 17-straight quarters of rising profits, despite sluggish
results from its peers.
Analysts will watch, in part, how Wells Fargo curbed a slowdown
in mortgage refinancing because of rising rates.
Worries about the fragility of Europe's banking system triggered
losses on Wall Street Thursday, but the S&P 500 index (SPX),
the Dow Jones Industrial Average (DJI) and the Nasdaq Composite
(RIXF) finished well off session lows.
European stocks were bouncing back Friday after Thursday's drop,
which came as Portuguese conglomerate Espírito Santo International
SA this week missed a payment on some short-term debt. That sent
shares of its subsidiaries, Banco Espirito Santo AS and Espirito
Santo Financial Group SA, spiraling lower.
"The fact Europe is rebounding from yesterday's sell-off is
helping cheer Wall Street futures," said Joao Monteiro, analyst at
Valutrades, in a note Friday. The Dow industrials are "in easy
reach of 17,000, so assuming there are no other surprises -- and
based on the assumption that a degree of short covering ahead of
the weekend break is as good as inevitable -- then the week could
well end on a positive tone in New York."
Fed speakers
With the market trying to pin down when interest rates will be
raised by the Federal Reserve, appearances by central bank
officials are of interest to investors. In Jackson Hole, Wyo.,
Philadelphia Fed President Charles Plosser at 11:15 a.m. Eastern
Time will moderate a panel on entrepreneurial issues at the Global
Interdependence Center's Rocky Mountain Summit.
Plosser -- known as a hawk -- is a voting member of the Fed's
policy committee this year. Plosser last month said the federal
funds rate should be raised starting in the third quarter, and that
rates should be higher because the central bank is nearing its
goals faster than many expected.
At 3 p.m. Eastern Time, Charles Evans, the president of the
Chicago Fed, and Dennis Lockhart, president of the Atlanta Fed
Bank, will be on a panel about success and failures of Fed policy.
Lockhart has said he expects short-term rates will be held at zero
until the latter half of 2015, while Evans has said it may not be
until 2016 that the Fed starts on its rate-hike path. Evans and
Lockhart are not voting members on the policy committee this
year.
Also on the radar Friday, tobacco giant Reynolds American Inc.
(RAI) confirmed that it's in talks with Lorillard Inc. (LO) about a
possible acquisition. Lorillard shares rose nearly 5% in premarket
trade.
Fastenal Co. (FAST), which makes fasteners, tools and other
industrial and construction supplies, reported second-quarter
earnings of 44 cents a share on sales of $949.9 million. Analysts
polled by Thomson Reuters were expecting per-share earnings of 44
cents on revenue of $952.5 million. Shares fell 3% in scant
premarket volume following the results.
An influential broadcaster in China said the location-tracking
function in Apple Inc.'s (AAPL) iPhone was a "national security
concern," in the latest backlash against U.S. tech firms.
Late Thursday, apparel retailer Gap Inc. (GPS) reported an
unexpected 2% drop in same-store sales in June. Shares fell more
than 1% in late trading Thursday.
In other markets Friday, crude for August delivery (CLQ4) fell
37 cents, or 0.4%, to $102.55 a barrel. August gold (GCQ4) fell 50
cents to $1,338.70 an ounce. Overnight in Asia, Japan's Nikkei
Average fell 0.3% and Hong Kong's Hang Seng Index ended flat.
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