* Commodity stocks seen spurring gains
* AIG fallout, Fed concerns persist
* Futures up: S&P 500 up 3.10 pts, Dow 11 pts, Nasdaq 3
For up-to-the-minute market news, click []
(Recasts first paragraph, updates prices)
By Ellis Mnyandu
NEW YORK, March 20 (Reuters) - U.S. stocks headed for a
rise at Friday's opening as a further rebound in shares of
natural resources companies offset bleak corporate outlooks and
fears of inflation.
U.S. front-month crude <CLc1> held above $50 a barrel a
day after surging 7 percent in the wake of the Federal
Reserve's plan to pump another $1 trillion into the
recession-hit economy. Spot gold prices hit a three-week high
earlier and copper prices have surged as the U.S. central
bank's plan fanned concerns of U.S. dollar weakness and
inflation.
Commodity stocks rising before the bell included miner
Freeport McMoRan Copper & Gold Inc <FCX.N> , up 1.6 percent to
$40.70. Shares of steelmaker U.S. Steel <X.N> climbed 2 percent
to $21.35.
"Everybody is going to be watching gold and other
commodities, with oil back above $50 and gold starting to
approach that $1,000/oz level again," said Paul Mendelsohn,
chief investment strategist at Windham Financial Services in
Charlotte, Vermont.
"Yesterday's activity in commodity stocks and commodity
markets was quite significant in my view in terms of how the
market is perceiving what the Fed did (on Wednesday) and its
potential impact down the road. The assessment is that this is
potentially going to be bad for the dollar."
S&P 500 futures <SPM9> were up 3.10 points and above fair
value, a formula that evaluates pricing by taking into account
interest rates, dividends and time to expiration on the
contract. Dow Jones industrial average futures <DJM9> climbed
11 points, and Nasdaq 100 <NDM9> futures added 3 points.
Trading was likely to be volatile as Friday marks the
quarterly expiration and settlement of four different March
equity futures and options contracts -- a convergence known as
quadruple witching.
The S&P 500 <.SPX>, up 14.7 percent this week so far, is on
track for its best 2-week run-up since 1974 when it rose 15.95
percent.
However, in addition to the fears of inflation from the
Fed's plan, there is concern that the ruckus over insurer
American International Group's <AIG.N> executive bonuses may be
distracting Washington from focusing on stabilizing the economy
and sapping investor confidence.
A separate measure by the Federal Reserve, a long-awaited
program to resuscitate consumer and small business lending, got
off to a stuttering start on Thursday as the AIG political fury
persisted. For details, see []
The developments put the focus on Federal Reserve Chairman
Ben Bernanke, who is scheduled to speak on the financial crisis
and community banking at a banking event in Phoenix, Arizona,
at 12 p.m. (1600 GMT).
Companies with disappointing outlooks included Xerox Corp
<XRX.N> , the world's top supplier of digital printer and
document management services, which warned quarterly earnings
will fall far short of its earlier expectations as a slowdown
in technology spending undercuts revenue. []
Xerox shares dropped 8.8 percent to $4.87 before the bell.
U.S. stocks fell on Thursday on concerns that the Federal
Reserve's latest efforts to stem the U.S. recession are too
costly and untested, prompting investors to book profits on
bank shares after the recent sharp rally.
(Reporting by Ellis Mnyandu, Editing by Chizu Nomiyama)
