Eagle River, WI 10/21/2011 (PennyPayDay) – After seeing considerable volatility in the previous session, stocks moved sharply higher at the start of trading on Friday. The major averages all showed notable moves to the upside after ending the previous session on opposite sides of the unchanged line.In the past few minutes, the major averages have seen some further upside, reaching new highs for the young session. The Dow is up 158.48 points or 1.4 percent at 11,700.26, the Nasdaq is up 31.21 points or 1.2 percent at 2,629.83 and the S&P 500 is up 16.60 points or 1.4 percent at 1,231.99.
The early strength on Wall Street is partly due to renewed optimism about the financial situation in Europe, where leaders are trying to reach an agreement on a plan that could potentially resolve the region's ongoing debt crisis.
While a statement from France and Germany indicated that the European leaders are not likely to reach an agreement on the debt crisis at a summit on Sunday, a second summit has been scheduled for Wednesday.
Peter Boockvar, equity strategist at Miller Tabak, said, "While we won't get a definitive response from the Europeans this weekend on how best to deal next with their debt crisis, officials are still holding out hope that just a few extra days will complete the job."
"With the S&P 500 above 1,200, the DAX near 6,000 and the euro closer to 1.40 than 1.30, markets are assuming something," he added. "Whether what is put in place actually works or not is a different discussion, markets just want satisfaction now."
In corporate news, Microsoft (MSFT) reported first quarter earnings of $0.68 per share, in line with analyst estimates. The software giant said its revenues rose 7 percent to $17.37 billion, ahead of the consensus estimate.
General Electric (GE) reported third quarter adjusted earnings of $0.31 per share, matching Wall Street expectations. The diversified conglomerate reported revenues that were flat at $35.4 billion compared to estimates for $34.9 billion.
McDonald's (MCD), Verizon (VZ), and Honeywell (HON) are among the other major companies that have released their quarterly results before the start of trading.
Computer hardware stocks are seeing significant strength in early trading, driving the NYSE Arca Computer Hardware Index up by 3.8 percent. Seagate Technology (STX) is helping to lead the sector higher after reporting better than expected first quarter earnings.
Early strength has also emerged among gold stocks, which are moving back to the upside along with the price of the precious metal. Semiconductor, housing, and biotech stocks are also posting notable gains, moving higher along with most of the other major sectors.
In overseas trading, stock markets across the Asia-Pacific region turned in a lackluster performance on Friday before ending the day mixed. While Japan's Nikkei 225 Index ended the day just below the unchanged line, Hong Kong's Hang Seng Index edged up by 0.2 percent.
Meanwhile, the major European markets have shown notable moves to the upside over the course of the trading day. The U.K.'s FTSE 100 Index is up by 1.4 percent, while the French CAC 40 Index and the German DAX Index are jumping by 2.2 percent and 2.7 percent, respectively.
In the bond market, treasuries are seeing modest weakness amid the early strength on Wall Street. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 2.7 basis points at 2.207 percent.
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