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Stocks up at opening bell as rally continues

Stocks opened the trading day up slightly on Friday and were on track for a fourth day of gains, with Amazon the latest company to extend an earnings-driven rally that has erased most of April's losses and left investors eyeing a return to a new recovery high.

Amazon.com's profits and sales beat expectations. The stock jumped 17.8 percent in premarket trade.

Economic growth cooled more than expected in the first quarter, according to a government report, offsetting some of the optimism but was not enough to turn the market around. Gross domestic product expanded at a 2.2 percent annual rate, while investors expected 2.5 percent.

"I don't think it is terribly surprising. We had been expecting something like this, something sub 2.5 percent growth," said Steven Baffico, chief executive At Four Wood Capital Partners in New York.

"There's nothing catastrophic happening, this is just slow growth and this underscores that the economy is on sound footing but nothing more."

With 254 companies in the S&P 500 reporting, more than 72 percent have topped estimates, according to Thomson Reuters data as of Thursday. A big beat from Apple drove Wednesday's rally, which gave the Nasdaq its best day of the year.

Online travel agency Expedia topped estimates for profit growth as worldwide hotel revenue increased. Its shares gained about 20 percent.

The S&P 500 is on track for its best week in a month, rising 1.6 percent so far and up for three straight days. The move has wiped out much of the index's losses for April and lifted the index well above its 50-day moving average.

"By and large, earnings season has been positive and has proven to be an offset to the euro debt situation and to the mixed economic numbers of late," said Andre Bakhos, director of market analytics at Lek Securities in New York

"With the (S&P 500) above 1,400 yesterday and closing just below it completes a bottoming consolidation formation and now the stage is set for a move high."

The euro debt crisis was not far away. Standard & Poor's on Thursday cut its credit rating on Spain by two notches, citing expectations government finances will deteriorate even more than previously thought.

But European shares rose Friday, helped by encouraging company earnings. The FTSEurofirst 300 index of top European shares  was up 0.9 percent.

In other earnings news:

Procter & Gamble lowered its profit forecast for the year and posted lower earnings.

Merck & Co Inc's income came in slightly above estimates.

Ford reported higher-than-expected quarterly profit as strong North America results helped offset weak international operations and higher taxes.

Starbucks earnings came in better than expected, but global sales missed estimates due to weakness in Europe.

Reuters contributed to this report.