(Reuters) -U.S. stock index futures jumped on Friday after signs China was prepared to soften its stance on tariffs, while better-than-expected quarterly results from heavyweight Alphabet lifted its shares and supported other technology stocks.
China has granted some U.S. imports exemptions from its hefty 125% tariffs, and is asking firms to identify critical goods they need levy-free, according to businesses notified.
That was the clearest sign yet that Beijing is worried about the economic fallout from its trade war with Washington, and followed indications from U.S. officials that the White House was ready to de-escalate tensions between the world’s two largest economies.
Meanwhile, Google-parent Alphabet reported upbeat first-quarter results, easing investor worries about returns on hefty artificial intelligence-focused investment.
Shares of the firm – one of the “Magnificent Seven” group of heavyweight stocks – jumped 5.6% in premarket trade. Other social media companies rose after strong Google ad revenue, with Meta Platforms up 3.9% and Pinterest gaining 4.9%.
At 5:25 a.m. ET, Dow E-minis were up 26 points, or 0.06%, S&P 500 E-minis were up 23 points, or 0.42% and Nasdaq 100 E-minis were up 75.5 points, or 0.39%.
Wall Street’s main indexes were set for strong weekly gains after signs of a possible detente in U.S. President Donald Trump’s trade war with China and his backtracking on threats to fire the head of the Federal Reserve, as well as some upbeat corporate results.
Indexes rose for the third consecutive session on Thursday, the best winning streak for the S&P 500 since Trump’s April 2 “Liberation Day” tariff announcement.
The S&P 500 is so far up 3.8% for the week, while the Nasdaq Composite and the Dow are on track to rise 5.4% and 2.4%, respectively.
Volatility has also eased this week, with the CBOE Volatility Index falling to its lowest level since April 3.
Short covering was also boosting equities, analysts at Societe Generale said.
Despite the positive developments on trade, market sentiment remains cautious given the often erratic nature of Trump’s policy shifts, indications of a souring economic outlook and hits to company earnings and outlook from tariffs.
The benchmark index remains below levels prior to the April 2 announcement, and is over 10% off its February record close.
Intel dropped 5.6% following the chipmaker’s dour forecast, while T-Mobile fell 5.2% after adding fewer wireless subscribers than expected in the first quarter.
Earnings from Phillips 66 and AbbVie are among those expected before the bell.
The data docket is light, with the final reading of the University of Michigan’s April consumer survey due at 10 a.m. ET.
(Reporting by Lisa Mattackal in Bengaluru; Editing by Maju Samuel)
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