Bay Street Seen Opening Higher

(RTTNews) - Canadian shares are likely to open higher Friday morning, reacting to fairly strong earnings updates from U.S. banks, and on easing concerns about interest rates thanks to recent soft inflation data from the U.S.

U.S. banks Citigroup Inc., JP Morgan Chase and Wells Fargo have reported stronger than expected quarterly results this morning.

On the economic front, data on Canadian manufacturing sales for the month of May is due at 8:30 AM ET.

The Canadian market ended on a strong note on Thursday, rising for a third straight session, thanks to sustained buying at several counters from across various sectors.

Concerns about interest rates have eased after data on Wednesday showed U.S. inflation softened in the month of June. Today, the Labor Department's report showed producer prices in the U.S. inched up by slightly less than expected in the month of June, with the index rising by 0.1%. Economists expected producer prices to rise by 0.3%.

Hopes of additional stimulus in China to boost growth in the world's second largest economy contributed as well to the positive mood in the market.

The benchmark S&P/TSX Composite Index ended with a gain of 206.87 points or 1.03% at 20,277.64.

Asian stocks moved higher on Friday as optimism about receding inflation in the U.S. and China stimulus hopes aided sentiment.

Traders also awaited the unofficial start of the second-quarter U.S. earnings season.

European stocks are turning in a mixed performance with investors digesting earnings updates from U.S. bank majors.

In commodities, West Texas Intermediate Crude oil futures are down $0.12 or 0.16% at $76.77 a barrel.

Gold futures are down $1.10 or 0.06% at $1,962.70 an ounce, while Silver futures are gaining $0.101 or 0.4% at $25.050 an ounce.