Investing.com - Wall Street futures pointed to a higher open on Friday, putting U.S. stocks on track to end 2016 on a positive note for the last trading day of the year.
The blue-chip Dow futures gained 35 points, or 0.18%, by 6:58AM ET (11:58GMT), the S&P 500 futures advanced 5 points, or 0.22%, while the tech-heavy Nasdaq 100 futures traded up 11 points, or 0.22%.
Even with the slight gains noted in index futures, the Dow looked unlikely to reach the psychologically important level of 20,000 points which would require a gain of about 180 points.
Beyond the psychological impact of the triple zero milestones, the key technical resistance to watch for the future is this year’s all-time high reached on December 20 at 19,987.63 points.
In any case, U.S. stocks were set to record a stellar year with the Dow currently up around 14%, the S&P advancing around 10% and the Nasdaq Composite pocketing yearly gains of close to 9%.
Wall Street looked ready to end 2016 on a completely different note than sentiment when global stocks plunged in the first few weeks of the year as fears over the outlook for global growth brought out the bears.
Equities were not the only asset class set to close the books Friday with strong gains as crude oil, rubber and metals bounced back from several years of losses on the back of output cuts and expectations of firmer demand.
Still, Friday’s session looked unlikely to make a significant dent in markets with trading volumes thin with many traders still on holiday or packing up for what would be a long weekend with Wall Street closed on Monday.
In a light calendar day, the Chicago purchasing managers’ index (PMI) for December at 9:45AM ET (14:45GMT) was the only scheduled excuse for possible stock moves.
In that context, investors were already focusing more on the outlook for 2017 as market participants prepared to watch fiscal policies to be implemented when President-elect Donald Trump takes office on January 20, the U.K.’s triggering of article 50 which will kick start negotiations for its exit from the European Union, key elections in France and Germany, promises made Friday by China’s central bank to keep monetary policy stable in order to help maintain liquidity conditions, the kick off starting January 1 of major oil producers’ agreement to cut back on crude production, along with developments surrounding the U.S. economy and its impact on the Federal Reserve’s (Fed) plans to hike rates three times in the coming year.
Markets remained skeptical as the Fed’s December 2015 promise to tighten policy four times in 2016 ended with only one increase at the end of this year.
With this in mind, Fed fund futures priced in just two moves in 2017, according to Investing.com's Fed Rate Monitor Tool.
Odds stood at around 65% for the first hike to arrive in June and just over 50% for a second move in November.
However, markets put the likelihood of the Fed hiking three times by the end of 2017 at only 35%.
Meanwhile, gold prices rose to a three-week high amid low-volume holiday trading on Friday, as the U.S. dollar continued to pull back against major rivals, boosting the appeal of the yellow metal.
Gold for February delivery on the Comex division of the New York Mercantile Exchange rose to a session peak of $1,164.25 a troy ounce, a level not seen since December 9.
Prices of the yellow metal sank to an 11-month low of $1,124.30 earlier in December.
Gold has rebounded almost 3% from that trough and is logging gains of more than 9% for the year.
Oil, for its part was trading flat with mixed signs on Friday, as the commodity took a breather from a rally that saw crude rise around 50% since the start of the year.
U.S. crude oil futures advanced 0.11% to $53.83 at by 6:59AM ET (11:59GMT), while Brent oil slipped 0.05% to $56.82.