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Stocks open flat as Street looks ahead to French election; earnings still coming strong

CNBC logo CNBC 4/21/2017 Fred Imbert

© Provided by CNBC U.S. stocks opened mostly flat on Friday as investors look ahead to France's presidential election while digesting more quarterly results from companies.

Dow component Visa reported better-than-expected quarterly results and announced a $5 billion buyback of class A stock. General Electric, another Dow component, also beat Wall Street estimates for earnings and revenue.

Earnings season has gotten off to a strong start. As of Thursday morning, 76 percent of the 82 S&P 500 companies that had reported topped earnings-per-share estimates while 67 percent beat on sales, according to data from The Earnings Scout.

Equities rallied on Thursday, as corporate earnings and comments from Treasury Secretary Steven Mnuchin on tax reform lifted investor sentiment.

"Investors seem to be optimistic but there are factors dampening that optimism," said Peter Cardillo, chief market economist at First Standard Financial. "The market is concerned over the French election."

Uncertainty around the election has grown over the past month after far-left candidate Jean-Luc Melenchon's surprising surge in the polls. Concerns over a victory from far-right candidate Marine Le Pen rose after a shooting in Paris.

Le Pen has said repeatedly that, if she wins, she'd pull France out of the European Union and the euro zone.

But centrist and pro-European candidate Emmanuel Macron is still the favorite to win the contest, according to French polling firm Ifop. The French presidential election is held over two rounds; the first one will be held Sunday and the second on May 7.

"He crushes each of them, most notably Marine Le Pen and Jean-Luc Mélenchon, in a head-to-head contest. These two outsiders therefore have a much higher mountain to climb in a much shorter period than Donald Trump had when challenging Hillary Clinton," said Jeremy Klein, chief market strategist at FBN Securities, in a note.

European equities traded mostly higher, with the pan-European Stoxx 600 index rising 0.16 percent. The French CAC 40 index slipped 0.18 percent.

In economic news, existing home sales data for March are due at 10 a.m. ET.

On tap this week:

10:00 a.m. Existing home sales


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