- Global stocks rose as investors' grew more optimistic about the pace of Fed rate hikes.
- Futures on the S&P 500, Dow Jones, and the Nasdaq 100 built on Thursday's strong rally, signaling an end to weekly losses.
- A closely watched reading on US inflation is due later and could give a pointer to the Fed's next move.
Global stocks edged higher Friday, headed for their first weekly win in two months as investor jitters over the Federal Reserve's monetary tightening calmed somewhat.
Equities were also still riding the boost from upbeat retailers' financial reports on Thursday, which sent US stock markets soaring. Strong earnings results from Dollar Tree, Dollar General, and Macy's eased fears of a pullback in consumer spending.
Futures for the S&P 500 rose 0.25%, while those on the Dow Jones were about flat. Nasdaq futures were up 0.43%. If those indicated gains hold to the close, that will end the S&P 500's seven-week losing streak and the Dow Jones eight-week run of losses.
The MSCI All-World index was up 1.6%, with stocks in Europe and Asia in the green.
Investors have taken some heart from the Federal Open Market Committee's minutes on Wednesday, which some have interpreted as signaling a turning point ahead, as the Fed alluded to softer-than-expected inflationary pressures.
Meanwhile, the US dollar headed for a second weekly drop, reflecting growing investor optimism that the Fed will not raise interest rates as quickly as many had expected once it has made its planned 50 basis point rises in June and July.
"Investors were relieved there wasn't a 75 basis points hint." Giles Coghlan, HYCM's chief currency analyst told Reuters.
A reading on US core PCE inflation due later in the day will be closely watched for what it could mean for Fed policy.
"Of course, inflation is likely to stay high, and we don't expect it to moderate back to central banks' targets in the near term," Goldman Sachs strategists led by Peter Oppenheimer wrote in a note.
"Also, the inflation expectations of households and corporates have risen, and second-round effects might prolong the inflationary problem, especially with rising wages given tight labor markets. In the UK and US there are more jobs than workers at the moment," they added.
"But overall, we think headline inflation is likely to be peaking. Could this be a catalyst to support a turn in equities? We think it is probably more a necessary than sufficient condition," they said.
Elsewhere, in Europe, the pan-continental STOXX 600 was up 0.86%, while Frankfurt's DAX rose 0.79%. London's FTSE 100 stepped 0.22% higher.
In Asia, Tokyo's Nikkei 225 closed up 0.7%, and the Hang Seng up 2.9%. Chinese stocks rose on the back of strong first-quarter earnings from tech giants such as Alibaba Group and Baidu. The CSI 300 rose 0.21%, while the Shanghai Composite gained 0.23%.
On the energy front, crude oil prices nudged lower, losing hold of gains earlier in the morning. Brent crude was down 0.3% at $113.81 a barrel, while WTI crude was down 0.4% at $113.64 a barrel.
Gold rose, as investors turned to the safe-haven asset as a hedge against inflation and a store of value as the purchasing power of the dollar falls. The precious metal was trading hands near two-week highs at $1,855.50 an ounce, up 0.42%.