World Stocks Drift Friday

HONG KONG (AP) --- World stock markets drifted Friday as investors increasingly factored in a Fed rate hike soon, based on the brightening U.S. corporate and economic outlook.

KEEPING SCORE: European shares were slightly higher in early trading, with France's CAC 40 edging up less than 0.1 percent to 4,541.82 and Germany's DAX creeping 0.1 percent higher to 10,708.34. Britain's FTSE 100 also ticked 0.1 percent higher to 7,030.78. U.S. stocks were poised to open lower, with Dow futures slipping 0.2 percent to 18,069.00 and broader S&P 500 futures dipping 0.2 percent to 2,132.10.

FED OUTLOOK: Investors are starting to factor in a higher chance of the Fed raising interest rates from the ultralow levels that have fueled a multiyear stock boom, given the latest corporate and economic data. Most U.S. companies have posted quarterly earnings that have beaten analysts' expectations. Meanwhile, weekly applications for jobless benefits remained near a 43-year low while home sales rose at their strongest pace since June, reports said Thursday.

ANALYST INSIGHT: "While expectations for a December Fed rate hike are continuing to build, investment markets seem to be taking it a bit better than was the case in the run up to last December's eventual rate hike," Shane Oliver, head of investment strategy at AMP Capital, said in a report. He cited three differences from a year ago: a more positive global and U.S. growth outlook; U.S. earnings bottoming out rather than getting worse; and lower uncertainty over capital outflows from China and its yuan currency.

ECB STIMULUS: At a news conference on Thursday, the head of the European Central Bank kept alive the possibility that it could extend its stimulus program beyond March, the earliest possible end date. Mario Draghi said a decision on the 1.7 trillion euro ($1.9 trillion) bond-buying program would not come until December, which was widely expected. But he added it's unlikely there would be an "abrupt end" to the program. That sent the euro lower.

ASIA'S DAY: Japan's benchmark Nikkei 225 index lost 0.3 percent to end at 17,184.59 and South Korea's Kospi lost 0.4 percent to 2,033.00. The Shanghai Composite Index in mainland China edged up 0.2 percent to 3,090.94 while Australia's S&P/ASX 200 lost 0.2 percent to 5,430.30. Benchmarks in Southeast Asia were mixed. Hong Kong's stock market was closed due to a typhoon.

CURRENCIES: The dollar slipped to 103.82 yen from 104.08 on Thursday. The euro weakened to $1.0888 from $1.0927. The official exchange rate for the Chinese currency yuan fell to a six-year low against the dollar of 6.7558 yuan, as investors bet that an eventual interest rate hike in the U.S. will boost the dollar.

ENERGY: Oil prices stabilized. Benchmark U.S. crude gained 8 cents to $50.72 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.17, or 2.3 percent, to close at $50.43 a barrel on Thursday. Brent crude, used to price international oils, gained 10 cents to $51.48 a barrel in London.

(KA)