Futures rise as 'Trump rally' rolls on

[December 09, 2016]  By Yashaswini Swamynathan

(Reuters) - U.S. stock index futures edged up on Friday, indicating that investors were still eager to buy into the post-election rally that has propelled a host of Wall Street indexes to record highs.

The "Trump rally" has been running for the past month as investors bet President-elect Donald Trump's policies will boost economic growth and inflation.

The three main U.S. indexes closed at record levels for the second day in a row on Thursday, while the small cap Russell 2000 <.RUT> and the Dow Transport <.DJT> hit all-time highs.

Adding to the upbeat mood in the past weeks has been a spate of robust economic data, including on monthly hiring numbers, GDP growth and inflation, which have underscored the economy's strength.

However, one spot of worry is valuations, with the S&P 500 is currently trading at about 17.5 times forward twelve-month earnings, above the 10-year median of nearly 15 times, according to Thomson Reuters StarMine.

Data on tap for Friday is a preliminary reading of the consumer sentiment index for December, which is expected to hit 94.5 after rising to a 6-month high the previous month. The report is due at 10:00 a.m. ET (1500 GMT).

The stock market rally's resilience will be put to test after the Federal Reserve's policy meeting next week, where traders see a 94 percent chance of the central bank raising interest rates.

Among stocks, those of Restoration Hardware <RH.N> plunged 18.5 percent to $31.76 in thin premarket trading after the furniture retailer lowered its fourth-quarter profit forecast, citing slow sales in the holiday period.

Wynn Resorts rose 4.7 percent to $95 after Macau, the world's biggest gambling hub, clarified it had not tightened daily cash withdrawal limits for Chinese gamblers.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., December 8, 2016. REUTERS/Brendan McDermid

Biogen  rose 3.3 percent to $299 after a study showed higher doses of the company's Alzheimer's drug appeared to reduce the risk of brain swelling.

Futures snapshot at 7:04 a.m. ET:

Dow e-minis <1YMc1> were up 26 points, or 0.13 percent, with 8,213 contracts changing hands.

S&P 500 e-minis were up 1 point, or 0.04 percent, with 75,283 contracts traded.

Nasdaq 100 e-minis were up 5.75 points, or 0.12 percent, on volume of 8,599 contracts.

(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Savio D'Souza)

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