Stock Futures Mixed; Financial Stocks in Focus

NEW YORK (TheStreet) -- Stock futures are mixed Friday after tame inflation and New York manufacturing reports.

Futures for the Dow Jones Industrial Average were slipping 1 point, or 15.14 points below fair value, at 14,451.

The Dow posted its 10th-straight winning session on Thursday for the first time since 1996, and the S&P 500 neared its all-time high after a drop in last week's jobless claims bolstered confidence in the world's largest economy.

Futures for the S&P 500 were dipping 0.25 points, or 1.13 points below fair value, at 1,555.75. Futures for the Nasdaq were rising 2.5 points, or 1.95 points above fair value, at 2,802.5.

The Federal Reserve on Thursday approved the plans of 14 of the largest U.S. banks to return value to shareholders after they submitted to a battery of annual stress tests. Bank of America (BAC) and Morgan Stanley (MS) were among those that received approval. Bank of America said it will repurchase up to $5 billion of common stock and redeem about $5.5 billion in preferred shares. The stock was jumping 3.59% to $12.55 in premarket trading, while Morgan Stanley shares were rising 1.62% to $23.17.

The Fed also approved a request from JPMorgan Chase (JPM) to buy back up to $6 billion in stock through the first quarter of 2014 and boost its dividend in the second quarter to 38 cents a share from 30 cents.

Still, the Fed was cautious on its assessment of JPMorgan and Goldman Sachs (GS) and is requiring them to submit new plans to address weaknesses that regulators have identified. Goldman shares were falling 1.5% to $151.76 and JPMorgan was slumping 1.76% to $50.10.

Ally Financial and BB&T's (BBT) plans were rejected by the Fed. BB&T was shedding 2.8% to $30.84.

The Bureau of Labor Statistics said the Consumer Price Index rose 0.7% in February, greater than the 0.5% gain forecast by economists, after staying flat in January for a second month. The "core" CPI, which excludes volatile food and energy prices, rose 0.2%, as expected, after increasing 0.3%.

The headline CPI gain was led by a spike in gas prices, with other components looking relatively soft, which the BLS said will ease in March.

David Ader, head of U.S. government-bond strategy at CRT Capital Group LLC in Stamford, Conn., said in a note that the inflation gauge will "not be a Fed threatening figure."

The New York Federal Reserve Bank reported that the general business conditions index in its Empire Manufacturing Survey dipped to 9.2 in March from 10 in February. Economists expected a read of 10.

Ader said that elements of the report suggest moderation in March manufacturing activity, but it should still be expansionary.

At 9:15 a.m., the Federal Reserve releases February capacity utilization and industrial production data.

Industrial output is forecast to have risen 0.4% after dipping 0.1% in the previous month. Capacity utilization rates are expected to have risen to 79.3% from 79.1% in January.

At 9:55 a.m., the University of Michigan Consumer Sentiment Index for March is predicted to show an improvement to 78 from 77.6 in February.

The benchmark 10-year Treasury was sliding 2/32, boosting the yield to 2.041%. The dollar was down 0.41%, according to the U.S. dollar index.

Japan's Nikkei 225 gained 1.45% after Japan's parliament overnight approved Haruhiko Kuroda as governor of the Bank of Japan.

Hong Kong's Hang Seng index finished off 0.38%, hit by a raft of profit-taking and concerns over China's economic recovery.

The FTSE 100 in London was down 0.6% and the DAX in Germany fell 0.14%.

Samsung unveiled its eagerly anticipated Galaxy S4 smartphone at a glitzy event in New York on Thursday night, launching another rival to Apple's (AAPL) iconic iPhone. Still, Apple shares were tacking on more than 1% to $438.

Boeing (BA) said Friday that its grounded 787 jets could resume flying "within weeks" after the company outlined a fix for the Dreamliner's lithium-ion battery system. Shares were up 0.22% to $84.81.

Carnival (CCL), the cruise ship operator, is forecast on Friday to post fiscal first-quarter earnings of 2 cents a share at 9:15 a.m. EDT.

Meanwhile, passengers from the cruise ship Carnival Dream were taken to the airport Thursday instead of sailing home after an on-board generator problem halted the ship in St. Maarten.

Shares were off more than 1% to $35.24.

Written by Andrea Tse in New York

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