(Alliance News) - Stocks in London are set to open slightly higher on Friday, ahead of earnings from major US banks, as sentiment was lifted by a cooler-than-expected US inflation reading.

IG says futures indicate the FTSE 100 index of large-caps to open up 16.5 points, 0.2%, at 7,859.88 on Friday. The FTSE 100 index closed up 18.54 points, or 0.2% at 7,843.38 on Thursday.

"European markets underwent another positive session yesterday, driven by outperformance from the luxury sector, with the CAC 40 closing at new record highs, while the DAX and FTSE100 also eked out some modest gains," said CMC Markets' Michael Hewson.

The CAC closed up 1.1% at 7,480.83, with LVMH adding 5.7%.

In the US on Thursday, Wall Street rallied, with the Dow Jones Industrial Average ending up 1.1%, the S&P 500 up 1.3% and the Nasdaq Composite up 2.0%.

Sentiment was buoyed by a cooler-than-expected wholesale inflation print.

According to the Department of Labor, producer price inflation eased to 2.7% year-on-year in March, from 4.9% in February, short of the FXStreet cited consensus of 3.4%. February's figure was upwardly revised from 4.5%.

This caused some to hope the Federal Reserve may be nearing the end of its rate hiking cycle, with potential rate cuts on the horizon later this year.

"However, with the US labour market still holding up reasonably well it's hard to imagine the Federal Reserve will be in any rush to cut rates while the US economy continues to hold up reasonably well on the jobs front," CMC's Hewson noted.

The dollar was mixed against major currencies, as the pound climbed higher above USD1.25, and the euro consolidated gains above USD1.10.

Sterling was quoted at USD1.2540 early Friday, higher than USD1.2519 at the London equities close on Thursday. The euro traded at USD1.1070 early Friday, higher than USD1.1053 late Thursday. Against the yen, the dollar was quoted at JPY132.55, up versus JPY132.41.

Later in the day, Wells Fargo, JPMorgan and Citigroup report their quarterly earnings, along with asset manager BlackRock.

The results will show "how lending to US businesses and consumers held up during what was a turbulent quarter for the sector", Hewson noted.

In Asia on Friday, the Nikkei 225 index was up 1.2%. In China, the Shanghai Composite was up 0.4%, while the Hang Seng index in Hong Kong was up 0.2%. The S&P/ASX 200 in Sydney was up 0.5%.

In UK company news, British polling firm YouGov is set to appoint a former Meta Platforms executive as its new chief executive officer, Sky News reported on Thursday.

Steve Hatch, who served as Meta's head of northern European operations, will be announced as YouGov's new CEO potentially as soon as Friday morning, Sky reported.

Gold was quoted at USD2,041.79 an ounce early Friday, little changed from USD2,040.03 on Thursday. Brent oil was trading at USD86.38 a barrel, down from USD87.01.

In Friday's UK corporate calendar, bookmaker 888 Holdings and sausage casing manufacturer Devro will release full-year results, while AO World, Hays and CMC Markets will publish trading statements.

In the economic calendar, there's the German wholesale price index at 0700 BST, US retail sales at 1330 BST, with US industrial production at 1500 BST.

By Elizabeth Winter, Alliance News senior markets reporter

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