Stock index futures edged higher on Friday as investors bet that key economic data will show the economic slump is ebbing.
A string of stronger-than-expected second-quarter results have helped reinforce some optimism about economic stabilization. Companies posting solid results early Friday
included Constellation Energy Group Inc
The government will release second-quarter gross domestic product figures, a measure of all goods and services produced within the U.S. borders, at 8:30 a.m. EDT (1230 GMT).
A Reuters poll of economists showed a median forecast of a 1.5 percent contraction in the economy in the second quarter on a seasonally adjusted annualized basis, compared with a more dramatic 5.5 percent contraction in the first quarter.
S&P 500 futures were 4 points higher and above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures climbed 36 points, and Nasdaq 100 futures rose 5.75 points.
GDP is going to be negative, and everyone knows we're going to get that second-half rebound. So in a sense it's old news, but at least it provides a baseline for what the second half of 2009 is going to be, said Peter Boockvar, equity strategist at Miller Tabak & Co in New York.
We are rallying because everyone expects to see a pickup in the second half of the year and it's just going to be a matter of to what degree.
Boockvar added that the market might also get a boost from so-called window dressing -- when traders ditch laggards in favor of winners to spruce up client portfolios at the end of the month.
U.S. President Barack Obama sought to prepare the country for the second-quarter GDP figures Thursday.
I suspect that the GDP numbers will still show that the economy contracted in the second quarter (and) that job loss is still a huge problem, Obama told reporters in the Oval Office.
Stocks to watch include oil company Chevron Corp
Walt Disney Co
With Friday marking the end of July, the Dow was on track for its best monthly percentage gain since October 2002, while the S&P 500 and the Nasdaq will likely mark their fifth straight month of gains.
At Thursday's close, the Dow was up 8.38 percent for the month of July, while the S&P 500 had added 7.34 percent and the Nasdaq had gained 8.13 percent.
U.S. stocks rose Thursday as several companies posted solid profits and data showed a drop in the number of Americans on jobless benefits fueled recovery hopes.
Hopes that the recession that started in December 2007 is moderating have underpinned a rally in U.S. stocks since early March, when the benchmark S&P 500 <.SPX> hit a 12-year low.
(Reporting by Ellis Mnyandu; editing by Jeffrey Benkoe)