US open: Equities rally on strong earnings and PBoC's decision

US stocks rallied early on Friday, boosted by a series of positive earnings and by news the People Bank of China has opted to cut its interest rates.

Shortly before 1500 BST, the Dow Jones Industrial Average was up 148 points to 17,636.85, while the S&P 500 and the Nasdaq were 18 and 83 points higher, respectively.

Tech firms rally

Amazon rallied 6.87% after soaring 11% late on Thursday, after the e-commerce giant posted an unexpected profit for the third quarter and offered an upbeat outlook for the holiday period.

Alphabet, Google’s holding company, surged 8.26% after announcing its first ever stock buyback plan, revealing it will invest more than $5bn in the programme.

“Profits are up almost 50% in the third quarter over the previous year, and this is whilst Google’s earnings are still wrapped up with costly side projects like self-driving cars, which won’t be the case in January under the new corporate structure,” said CMC Markets’ analyst Jasper Lawler.

Microsoft jumped 10.3% after posting better-than-expected revenue and profit late on Thursday, while Twitter gained 1.34% after its chief executive pledged to give $200m of his own shares to the employee stock pool..

PBoC cuts interest rates

After the close of the Asian session, the People's Bank of China said it will cut its one-year deposit rate and one-year lending rate by 25 basis points each to 1.5% and 4.35%, respectively, as it looks to bolster the slowing economy.

"As usual the PBOC showed its preference for action over rhetoric by cutting interest rates for the sixth time since November," said David Morrison, market analyst at SpreadCo.

"China’s move should help to underpin risk assets as we get further towards the year-end. But the ECB have to come up with the goods at their December meeting. Then the big question is whether the Fed will delay a rate hike until next year."

Meanwhile, Asian and European stocks rallied as both were boosted by the prospect of more stimulus from the European Central Bank.

On Thursday, after the press conference after the rate announcement, ECB President Mario Draghi said the governing council had discussed expanding its bond-buying programme and cutting the rate on reserves held at the central bank.

“Although there might well be some debate as to the direct benefits of a change to already record-low interest rates, this once again proves that under Mario Draghi the ECB is acting rather than just venting rhetoric,” said Alastair McCaig, senior market analyst at IG.

The dollar was broadly against the yen and rose 0.19% and 0.32% against the pound and the euro respectively, while gold futures declined 0.43% to $1,170.94.

Oil prices declined, with West Texas Intermediate losing 2.05% to $44.47 a barrel, while Brent climbed 0.88% to $47.66 a barrel.