Stocks get ready to continue gains

NEW YORK (CNNMoney) -- U.S. stocks are gearing up for a higher open, but trading could be choppy Friday as investors also close out options and futures contracts that expire.

The Dow Jones industrial average (INDU), S&P 500 (SPX) and Nasdaq (COMP) futures were all about 0.5% higher ahead of the opening bell. Stock futures indicate the possible direction of the markets when they open at 9:30 a.m. ET.

Investors showed little reaction to the government's latest data on inflation released early Friday. Consumer prices rose at a 3.4% annual rate in November, virtually unchanged from the prior month, the government said.

The energy index declined for the second month in a row, offsetting price increases in food. Consumer prices were expected to show prices rose 0.1% in November, after falling that same amount in October.

"The moderation of inflation is a very positive thing, so that could be a good wind behind our back today," said David Allon, senior financial advisor at First Trust Financial Resources, before the report came out.

Friday also brings "quadruple-witching," when four types of contracts expire -- those tied to market index futures, market index options, stock options and stock futures. Quadruple witching can often make for a volatile day for stock markets, as traders move to make last minute bets.

"Typically we see a lot of volatility because of settlement, both in the morning and the afternoon," said Allon. "It can muddy the waters."

U.S. stocks closed higher Thursday on upbeat jobs and manufacturing reports, but investors said the market remains nervous about the European debt crisis.

Europe's odds of success

Economy: In prepared testimony, New York Fed President William Dudley said he doesn't anticipate the Federal Reserve will step in with further efforts to address the potential spillover effects of Europe on the United States.

Dudley is scheduled to appear before a House committee at 9:30 a.m. ET to discuss what the euro crisis means for taxpayers and the U.S. economy.

At separate events, Chicago Fed President Charles Evans and Dallas Fed President Richard Fisher are also scheduled to give speeches later Friday.

Companies: U.S. bank stocks were mixed, following an overnight downgrade from Fitch. The banks included Bank of America (BAC, Fortune 500), Morgan Stanley (MS, Fortune 500), and Goldman Sachs (GS, Fortune 500), as well as Europe's Barclays, Societe Generale, BNP Paribas, Deutsche Bank and Credit Suisse.

Zynga (ZNGA) shares are expected to begin trading on the Nasdaq Friday, after pricing at $10 a share in the company's initial public offering late Thursday.

Research in Motion (RIMM) shares fell 9.6% in premarket trading, a day after the BlackBerry maker offered a disappointing outlook for the current quarter and next year, when it released its earnings results.

World markets: European stocks were higher in morning trading. Britain's FTSE 100 (UKX) ticked up 0.5% while the DAX (DAX) in Germany and France's CAC 40 (CAC40) were flat.

Asian markets ended higher. The Shanghai Composite (SHCOMP) rose 2%, the Hang Seng (HSI) in Hong Kong gained 1.4% and Japan's Nikkei (N225) edged higher 0.3%.

Currencies and commodities: The dollar fell against the Japanese yen, the euro and British pound.

Oil for January delivery rose 36 cents to $94.23 a barrel.

Gold futures for February delivery rose $18.10 to $1,595.30 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury fell, pushing the yield up to 1.93% from 1.91% late Thursday.