US STOCKS-Wall Street set for new highs on strong data, earnings

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US STOCKS-Wall Street set for new highs on strong data, earnings

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* U.S. housing starts race to 13-year high in December

* Schlumberger rises after Q4 earnings beat

* Rail road operators CSX, Kansas City down after results

* Futures up: Dow 0.31%, S&P 0.26%, Nasdaq 0.45% (Adds comment, updates prices)

By Sruthi Shankar

Jan 17 (Reuters) – U.S. stock indexes were set to scale fresh record highs on Friday, on optimism over corporate earnings, fresh economic data and indications of resilience in a Chinese economy battered by a prolonged trade war with the United States.

Investor sentiment has brightened this week after the world’s top two economies took the first step in calling a truce to their 18-month tariff dispute by sealing a Phase 1 trade deal.

The three main stock indexes closed at record highs on Thursday, with the S&P 500 surging past the 3,300-mark for the first time, also boosted by a rally in technology stocks and strong U.S. retail sales data.

In the final minutes of the trading session on Thursday, Google-parent Alphabet Inc became the fourth U.S. company to top a market value of over $1 trillion.

Spurring gains in global stocks for a fifth day, data showed the world’s second-largest economy ended 2019 on a somewhat firmer note, even as economic growth cooled to its weakest in nearly 30 years in the last year.

Further helping stock futures, U.S. homebuilding surged to a 13-year high in December, suggesting the housing market recovery was back on track amid low mortgage rates.

“There’s a lot of enthusiasm out there and it is a combination of earnings and strong data that is supporting the market,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.

“From a technical viewpoint, the market is a bit overbought and there is a possibility that the rally is going to exhaust itself at one point.”

After an upbeat showing from banks earlier this week, oilfield service provider Schlumberger NV reported a slightly better-than-expected quarterly profit, sending its shares up 2.1% in premarket trading.

At 8:58 a.m. ET, Dow e-minis were up 90 points, or 0.31%. S&P 500 e-minis were up 8.75 points, or 0.26% and Nasdaq 100 e-minis were up 41 points, or 0.45%.

Among other stocks, Qualcomm Inc’s shares rose 1.3% after Citigroup upgraded the stock to “buy” from “neutral”.

International Business Machines Corp dropped 1.2% after Morgan Stanley downgraded the stock to “equal weight”, saying information technology budgets are under pressure in 2020 and that are set to hit the hardware sector the most.

The Dow Jones Transports index could come under pressure after disappointing earnings updates from J B Hunt Transport Services Inc, Kansas City Southern and CSX Corp. (Reporting by Sruthi Shankar in Bengaluru; Editing by Maju Samuel)

Source: https://www.reuters.com/article/usa-stocks/us-stocks-wall-street-set-for-new-highs-on-strong-data-earnings-idUSL4N29M3BS