By Investors Hub
The major U.S. index futures are currently pointing to a higher opening on Friday, with stocks likely to extend the upward move seen over the three previous sessions.
Optimism about trade talks between the U.S. and China is likely to contribute to continued strength on Wall Street after yesterday?s Wall Street Journal report indicating the U.S. is considering lifting tariffs on Chinese goods.
Government officials have denied the report, although traders have recently been unrelentingly upbeat despite uncertainty about trade, the global economic outlook, and the ongoing U.S. government shutdown.
After turning in a lackluster performance for much of the session, stocks shot higher late in the trading day on Thursday. The major averages gave back ground after the spike but managed to remain firmly in positive territory.
With the gains on the day, the major averages once again reached their best closing levels in a month. The Dow advanced 162.94 points or 0.7 percent to 24,370.10, the Nasdaq rose 49.77 points or 0.7 percent to 7,084.46 and the S&P 500 climbed 19.86 points or 0.8 percent to 2,635.96.
The late-day rally came after a report from the Wall Street Journal said the U.S. is considering lifting tariffs on Chinese goods in an effort to calm markets and give Beijing an incentive to make deeper concessions.
People close to internal deliberations told the Journal that Treasury Secretary Steven Mnuchin proposed the idea of lifting some or all tariffs in a series of strategy meetings.
The people said the aim of easing the tariffs is to advance trade talks and win China’s support for longer-term reforms.
The report offset trade concerns raised by an earlier Journal report indicating federal prosecutors are pursuing a criminal investigation of China’s Huawei Technologies for allegedly stealing trade secrets from U.S. partners.
A negative reaction to quarterly results from Morgan Stanley (MS) also weighed on the markets early in the session, with the financial giant slumping by 4.4 percent.
The steep drop by Morgan Stanley came after the company reported fourth quarter earnings and revenues that came in below analyst estimates.
However, the negative sentiment was partly offset by a report from the Philadelphia Federal Reserve showing a significant acceleration in the pace of growth in regional manufacturing activity in the month of January.
The Philly Fed said its index for current manufacturing activity in the region jumped to 17.0 in January from 9.1 in December, with a positive reading indicating growth. Economists had expected the index to tick up to 10.0.
A separate report from the Labor Department unexpectedly showed a modest decrease in first-time claims for unemployment benefits in the week ended January 12th.
The report said initial jobless claims edged down to 213,000, a decrease of 3,000 from the previous week’s unrevised level of 216,000. Economists had expected jobless claims to inch up to 220,000.
Chemical stocks showed a strong move to the upside over the course of the session, driving the S&P Chemical Sector Index up by 1.8 percent to its best closing level in well over a month.
PPG Industries (PPG) posted a standout gain after the paint and coatings company reported fourth quarter earnings that beat analyst estimates.
Transportation stocks also saw considerable strength, resulting in a 1.6 percent advance by the Dow Jones Transportation Average. The average reached its best closing level in over a month.
Significant strength also emerged among steel stocks amid optimism about Chinese demand, with the NYSE Arca Steel Index climbing by 1.6 percent.
Tobacco, oil service and semiconductor stocks also moved notably higher on the day, contributing to the continued advance by the broader markets
Dipo Olowookere 
Adedapo Adesanya