Wall Street Awaits Jobs Report Amid Caution

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(RTTNews.com) - Early indications suggest that Wall Street may inch higher at the open of trading on Friday. That said, given the market moving nature of the non-farm payrolls report, market direction could largely hinge on how the numbers pan out. A fairly in line number could lead to a relief rally, as the averages are still in oversold territory. Although a strong number signals economic strength, it could trigger fears of scaling back of the Fed's stimulus.

At 6:15 am ET, the Dow futures are rising 21 points, the S&P 500 futures are moving up 4.40 points and the Nasdaq 100 futures are advancing 17.75 points.

U.S. stocks advanced solidly on Thursday, helped by positive jobless claims report and some encouraging earnings.

On the economic front, The U.S. Labor Department is scheduled to release its non-farm payrolls report for January at 8:30 am ET. Economists estimate the economy to have added 181,000 jobs in the month, while the jobless rate is estimated to have remained unchanged at 6.7 percent.

The Federal Reserve is due to release its report on outstanding consumer credit at 3 pm ET. The consensus estimates call for a $12 billion increase in outstanding consumer credit in December compared to a $12.3 billion increase in the previous month.

In corporate news, Carlyle Group ( CG ) announced a deal to acquire the industrial packaging group from Illinois Tool Works ( ITW ) for $3.2 billion. The deal is expected to close in the middle of 2014.LinkedIn (LNKD) said it has agreed to acquire Bright, a company connecting prospects and employers for $120 million, consisting of 73 percent in stock and 27 percent in cash.

News Corp. (NWS) reported a decline in its second quarter, although its adjusted earnings were flat and ahead of estimates. Revenues also exceeded estimates.

Expedia ( EXPE ) reported better than expected fourth quarter results. Netgear (NTGR) reported fourth quarter non-GAAP earnings of 59 cents per share on net revenue of $356.6 million. For the first quarter, the company expects net revenues of $335 million to $350 million. The results were better than expected and the guidance was in line.

Activision Blizzard ( ATVI ) reported better than expected fourth quarter results but issued weak guidance for 2014.

Gap (GPS) reported fourth quarter comparable store sales rose 1 percent and January comparable store sales were also up 1 percent year-over-year versus an 8 percent increase in the year-ago period. Net sales for the fourth quarter were down slightly to $4.58 billion from the year-ago quarter's $4.73 billion, slightly shy of estimates. The company also said it expects fourth quarter earnings of 65-66 cents per share, ahead of the consensus estimate.

Verisign (VRSN) reported fourth quarter non-GAAP earnings of 65 cents per share on revenues of $246 million. The results were ahead of estimates. Republic Services (RSG) reported fourth quarter adjusted earnings of 53 cents per share on $2.14 billion. For 2014, the company expects earnings of $1.93-$1.98 per share on revenue growth of 3.5-4.5 percent. The results exceeded estimates, while the earnings guidance was lukewarm.

The major Asian markets advanced, tracking the positive lead from Wall Street overnight. An upward revision of growth forecast by the Reserve Bank of Australia also lifted sentiment, although Chinese data disappointed to the downside.

Japan's Nikkei 225 average closed 307.29 points or 2.17 percent at 14,462. A majority of stocks advanced, with electric utilities seeing notable strength. Australia's All Ordinaries ended up 37.10 points or 0.72 percent at 5,185. Hong Kong's Hang Seng Index closed at 21,637, up 213.72 points or 1 percent and the Chinese market, which opened following weeklong Lunar New Year holidays, advanced, with the Shanghai Composite Index settling up 11.41 points or 0.56 percent at 2,045.

On the economic front, the Reserve Bank of Australia raised its forecasts for economic growth and inflation, citing a weaker currency. The bank said it expects a lower exchange rate to boost exports and restrain imports. A survey by Markit Economics and HSBC revealed that the HSBC service sector business activity index fell to 50.7 in January from 50.9 in December.

Japan's Cabinet Office reported that its leading economic indicators index for Japan rose to 112.1 in December from 111 in November. Economists had expected a reading of 111.9 for the month.

European stocks opened higher but retreated into negative territory in late morning trading only to cut their losses ahead of the U.S. non-farm payrolls report. The markets were reacting to some domestic data and the positive Wall Street lead.

In corporate news, steel giant ArcelorMittal (MT) reported full year earnings that beat estimates. The company's fourth quarter earnings were also better than expected. Meanwhile, Norway'sStatoil reported a decline in its fourth quarter earnings, hurt by lower realized pricing and higher depreciation costs.

On the economic front, U.K. industrial output rose less than expected in December, according to a report released by the U.K. Office for National Statistics. Industrial output was up 0.4 percent month-over-month following a 0.1 percent drop in November.

A separate report showed that U.K.'s trade deficit narrowed to 7.7 billion pounds in December from 9.8 billion pounds in November. Economists had expected a more modest narrowing of the deficit to 9.3 billion pounds.

Meanwhile, German foreign trade surplus hit the highest value since the beginning of compiling foreign trade statistics in 2013, provisional data from the Federal Statistical Office showed.The foreign trade surplus increased to 198.9 billion euros in 2013 from a 189.8 billion euro surplus in 2012, as the decline in imports outpaced the drop in exports. Exports dipped 0.2 percent and imports fell 1.2 percent.

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This article appears in: News Headlines

Referenced Stocks: ATVI , CG , EXPE , HSBC , ITW

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