* Red Hat gains after earnings, outlook
* Blackberry tumbles after results
* Final GDP reading tops expectations
* Futures up: Dow 20 pts, S&P 3.4 pts, Nasdaq 8.75 pts
By Chuck Mikolajczak
NEW YORK, Dec 20 U.S. stocks were set to open
higher Friday, putting the S&P 500 on track for its biggest
weekly climb in two months, as rosy U.S. growth data likely
boosts investor confidence that the economy can support a
wind-down of Federal Reserve stimulus.
Gross domestic product grew at a 4.1 percent annual rate in
the third quarter, the fastest pace in almost two years, and
higher than the 3.6 percent pace reported earlier this month.
Business spending was also stronger than previously estimated.
"Maybe it's not going to impact the fourth quarter (GDP) but
it can certainly lift 2014. The consensus is moving that way, we
are looking towards improved economic strength as we move into
2014," said Tim Ghriskey, chief investment officer of Solaris
Group in Bedford Hills, New York.
"The change is the fact equities are up on this news, maybe
even just a month ago they would have been down on this news
with the feeling this means the Fed is going to tighten or taper
On Wednesday, the central bank modestly trimmed the pace of
its market-friendly monthly asset purchases, by $10 billion to
$75 billion, and suggested its key interest rate would stay at
rock bottom longer than previously promised.
The S&P 500 has gained nearly 27 percent this year
and is on track for its biggest yearly gain since 1997, largely
fueled by the Fed's stimulus aimed at boosting the economy.
Fed Chairman Ben Bernanke said if U.S. job gains continue as
expected, the bond purchases would likely continue to be cut at
a "measured" pace through much of next year and would probably
be wound down "late in the year, certainly not by the middle of
S&P 500 futures rose 3.4 points and were modestly
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 rose
20 points and Nasdaq 100 futures added 8.75 points.
Red Hat Inc jumped 13.9 percent to $55.80 in
premarket trading after the world's largest commercial
distributor of the Linux operating system reported third-quarter
results above analysts' estimates and raised its full-year
Blackberry Ltd reported a massive quarterly loss on
Friday due to an inventory writedown and asset impairment
charges. Shares reversed course after initial losses in
premarket trading and were up 2.6 percent to $6.41 after
comments from the CEO.
Walgreen Co shed 2.1 percent to $55.75 in premarket
trading after the largest U.S. drugstore operator reported
higher first-quarter sales but said an increase in promotions
and a slowdown in the introduction of higher-profit generic
drugs cut into the gross profit margin.
Jones Group Inc climbed 5 percent to $14.83 after
the company said on Thursday it had agreed to be bought by
Sycamore Partners for $15 per share, or $1.2 billion.
Carnival Corp gained 3.6 percent to $39.40 before
the opening bell after Credit Suisse boosted its rating on the
stock to "outperform" from "neutral."