AMERICAN MARKETS OUTLOOK: U.S. stock markets are expected to open higher Friday as both the Dow Jones Industrial Average and the S&P 500 remain above significant support levels, despite giving back some gains Thursday.
Finspreads in London is calling the DJIA to open 17 points higher at 10900 and the S&P 1.5 points higher at 1265. The U.S. December trade balance at 1330 GMT will be significant for the markets as investors worry that the trade deficit will have widened in December from November and that the U.S. will have difficulty attracting enough foreign funds to plug the gap.
EUROPEAN MARKETS: European stock markets started the day lower Friday after overnight losses in Asia and a mixed close on Wall Street Thursday, but although most of them are still in negative territory they are coming back up around midday.
In London, the market has eased off highs as investors take a breather after pushing the FTSE to close to a three-and-a-half-year high Thursday. The FTSE 100 is down 0.1% at 5803.5, with energy stocks the most significant decliners. In Frankfurt, the DAX is down 0.1% at 5740.82, but a trader noted that losses are contained, and said "it appears as though the 5700 marker won't be tested." The French CAC 40 has firmed after a lower start and is trading up 0.1% at 4958.
Bunds and gilts have rebounded from a soft open as weak French fourth-quarter GDP data and revised German inflation numbers triggered a bout of short covering. Thursday's successful 30-year U.S. Treasury auction also helped European bonds. The March bund future is up 0.08 at 120.46, while the March gilt is 0.11 higher at 114.04.
The dollar is weaker on fears that poor U.S. trade numbers later in the day will refocus market attention on U.S. structural problems. These concerns currently outweigh positive news from the highly successful auction of 30-year Treasury bonds.
The dollar has fallen to Y117.52, while the euro is up slightly at $1.1975, as a warning by the European Central Bank about overheated house prices added to suggestions it plans to raise interest rates soon. The pound is stronger at $1.7455.
UK TRAILS OECD PEERS ON GROWTH TRACK: The Organization for Economic Cooperation and Development said its leading indicator of economic activity rose in December for the eighth straight month, signaling that moderate growth lies ahead in 30 of the world's richest economies. (Data Snap by Emily Barrett)
OIL OUTPUT DN ON WEATHER, NOT IRAN, SAYS IEA: Weather-related issues kept global oil supplies slightly tighter in January, rather than instability in Nigeria or the nuclear row involving Iran, the International Energy Agency said.
SINGAPORE'S PSA PULLS OUT OF P&O RACE: The battle to acquire Peninsular & Oriental Steam Navigation Co. (PO.LN) effectively ended Friday after Singapore-based port operator PSA pulled out of the running. (News Snap by Rod Stone and Steve McGrath)
QUINETIQ IPO PRICE CLOSE TO TOP END OF RANGE: U.K. defense research group QinetiQ Group PLC (QQQ.ZZ) said its initial public offering has been priced at 200 pence a share, toward the upper end of the 165p-205p price range. (News Snap by Rod Stone)
INSIGHT & ANALYSIS FROM DOW JONES NEWSWIRES:
=FOREX FOCUS: Structural concerns may not be very high on the dollar's worry list at the moment. However, U.S. trade data later Friday could well start rocking the dollar's boat. (By Nicholas Hastings)
=CHARTING EUROPE: April COMEX gold futures are looking increasingly fragile and are expected to decline through their Wednesday $548.5 intraday low in the days to come. (By Axel Rudolph)
=FOCUS: European Central Bank President Jean-Claude Trichet may be the only one who can officially comment on rate policy, but don't expect other ECB governing council members to remain completely silent, Deutsche Bundesbank President Axel Weber told Dow Jones Newswires in an interview. (By Peter Trautmann and Christian Vits)
=FOCUS: Faced with a shrinking work force, Europe's leaders are looking for new ways to attract talented immigrants, even as some countries close their borders to other immigrants willing to work for lower wages. (By John W. Miller)
=MIDEAST FOCUS: Oil traders may be gradually taking the Iran premium out of benchmark crude prices, but political risk in the Islamic nation is still very much on the minds of the energy industry. (By Grainne McCarthy)
=THE SKEPTIC: Virgin, EasyJet, Ryanair, Jetblue, not to mention countless millions of passengers, owe a huge debt of gratitude to Sir Freddie Laker, whose death was announced late Thursday. (By Howard Wheeldon)
STILL TO COME
0830/1330 US Dec Trade Deficit
1400/1900 US Jan Tsy Budget Statement
N/A FRA Monthly oil market report
France's economic growth slowed in the fourth quarter of 2005 after a dynamic third quarter, according to national statistics institute Insee's flash estimate. (Data Snap by Pierre Briancon)
Consumer prices in Germany fell on the month in January, with the decline driven by seasonal factors, the Federal Statistics Office said. (Data Snap by Jennifer Letki)
France's foreign trade deficit widened to a record EUR26.459 billion in 2005 compared with a deficit of EUR8.288 billion in 2004, the French customs office said. (Data Snap by Digby Larner)
AngloGold Ashanti Ltd. (AU) reported that its fourth-quarter net loss ballooned to $227 million as it made provisions for largely one-off depreciation, mine-rehabilitation and tax charges. (News Snap by Angus McMillan)
De Beers S.A., the 45%-owned unit of Anglo American PLC (AAUK) said its net earnings for 2005 were $554 million, up 11% from $498 million in 2004, boosted by a deferred tax gain and offset by $250 million set aside to pay a class action settlement. (News Snap by Jackie Range)
TeliaSonera AB (TLSN.SK), the Nordic region's largest telecommunications operator, said fourth-quarter net profit rose 31% on lower writedowns, while underlying profitability plummeted due to weakness in both Sweden and Finland. (News Snap by Magnus Hansson)
Swedish lock group Assa Abloy AB (ASSA-B.SK) Friday posted an 18% rise in fourth quarter net profit, citing strong organic growth and said it's reviewing plans for further restructuring to reach long-term goals. (News Snap by Malin Rising)
German sportswear company Puma AG Rudolf Dassler Sport (PUM.XE) reported a steep rise in full-year sales and profit on strong demand for sportswear. (News Snap by George Frey)