NEW YORK – Wall Street headed for a higher open Friday as investors sought to set aside inflation concerns and resume buying ahead of a speech by Federal Reserve Chairman Ben Bernanke.
Bernanke gave the market a jolt earlier this week when the Fed announced it will start buying Treasury securities to revive lending and, in turn, the economy. Wall Street initially jumped on the central bank’s decision.
Concerns have emerged, though, that the Fed’s buying of Treasury and other securities will weigh on the dollar and stoke inflation. In just two days, the dollar fell 5 percent versus the euro and 3 percent versus the yen. Oil prices, meanwhile, soared 7 percent Thursday above $51 a barrel to the highest level this year.
So after surging 14 percent over seven trading days, the Dow Jones industrial average on Thursday fell nearly 86 points, or 1.2 percent.
But considering how much the market has rallied, it appears to be holding up well. Since a batch of troubled banks told investors they were profitable in January and February nearly two weeks ago, the stock market bounced off its 12-year lows. Even after Thursday’s retreat, the Dow was still up 13 percent from its lows, and the S&P 500 index was up nearly 16 percent.
The question on Wall Street is whether there will be enough good news in the coming days to keep stocks afloat.
With the dollar recovering modestly against major currencies and Bernanke scheduled to give his speech at noon Eastern time, stock futures turned higher ahead of the market’s open.
Dow Jones industrial average futures rose 47, or 0.63 percent, at 7,414. Standard & Poor’s 500 index futures rose 2.40, or 0.3 percent, to 782.50, while Nasdaq 100 index futures rose 3.00, or 0.25 percent, to 1,206.50.
Government bond prices rose after retreating Thursday. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 2.58 percent from 2.60 percent late Thursday. The yield on the three-month T-bill, considered one of the safest investments, rose to 0.20 percent from 0.18 percent.
The dollar recovered modestly against other major currencies. Gold prices slipped.
Oil prices fell $1.10 to $50.51 a barrel in premarket electronic trading on the New York Mercantile Exchange.
In corporate news, mobile phone maker Sony Ericsson on Friday warned it expects to post a first-quarter loss before taxes as consumer demand continues to decline.
Printer and copier maker Xerox Corp. slashed its first-quarter profit forecast by nearly 80 percent on restructuring costs and a slowdown in technology spending. Xerox now expects earnings per share in a range of 3 cents to 5 cents, down from its previous forecast of 16 cents to 20 cents.
Italian automaker Fiat said it will not assume Chrysler’s current or future debt as it takes a 35 percent stake in the company.
And Citigroup Inc. said it was shifting Edward Kelly, the former head of global banking for Citi Private Bank, to the role of chief financial officer, and naming Gary Crittenden, formerly CFO, as chairman of Citi Holdings. Citi Holdings is the portion of Citigroup that holds the bank’s riskiest assets.
Overseas, Japan’s stock market was closed for a holiday. In afternoon trading, Britain’s FTSE 100 rose 0.10 percent, Germany’s DAX index rose 0.69 percent, and France’s CAC-40 fell 0.47 percent.
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