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Opening View: DJIA Cautiously Higher After ADP Report

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U.S. stocks are cautiously higher this morning, as investors digest ADP's monthly jobs report, which kicks off a three-day blitz of employment data. According to the payrolls processor, the private sector added 91,000 jobs in August, falling just short of economists' expectations for a surplus of 100,000 jobs. Nevertheless, Wall Street is taking the glass-half-full approach, with the Dow Jones Industrial Average (DJIA) trading about 37 points north of fair value.

In equities news, Oracle Corp. (ORCL - 27.87) has been under investigation by federal authorities for at least a year, The Wall Street Journal reported, citing sources familiar with the matter. Specifically, the feds are looking into whether the software maker's sales in Western and Central Africa violated the Foreign Corrupt Practices Act, which prohibits U.S. companies from offering or paying bribes to foreign government officials or employees of state-owned companies. In pre-market trading, ORCL is down 0.6%.

In earnings news, DryShips (DRYS - 3.17) reported a second-quarter net loss of $114.1 million, or 33 cents per share, compared to a profit of $19.5 million, or 7 cents per share, in the same period a year ago. Excluding items, DRYS said it earned 4 cents per share, falling short of analysts' expectations for an adjusted per-share profit of 17 cents. Meanwhile, revenue remained relatively flat at $224 million, missing the Street's forecast for sales of $258 million. At last check, the shares of DRYS are headed for a 12% drop out of the gate.

Elsewhere, Vera Bradley (VRA - 30.57) reported a fiscal second-quarter profit of $13.6 million, or 34 cents per share, up 49% from last year's earnings of $9.2 million, or 26 cents per share. Net revenue increased 30% to $103.8 million, as same-store sales ramped up 11%. The retailer also raised its full-year guidance, with the forecast now calling for earnings of $1.32 to $1.35 per share on revenue of $438 million to $443 million. "Our second-quarter performance was characterized by strong consumer response to our fall product assortment and our continued expansion into underpenetrated markets," said CEO Michael C. Ray. "We also managed margins in line with our expectations, despite pressure on input costs, and focused on disciplined expense management, yielding improved leverage." Ahead of the bell, VRA is poised to tack on roughly 7%.

Earnings Preview

Today's earnings docket will also feature reports from Coldwater Creek ( CWTR ), Genesco ( GCO ), Hovnanian Enterprises ( HOV ), Joy Global ( JOYG ), and Shuffle Master ( SHFL ). Keep your browser at for more news as it breaks.

Economic Calendar

Along with the ADP report, the Challenger, Gray & Christmas update on monthly job cuts is set to hit the Street later today. Also due out are July's factory orders and the Chicago purchasing managers index (PMI) for August, as well as the usual update on weekly petroleum supplies. Initial jobless claims are due out on Thursday, as is the ISM manufacturing index for August. Also on the day's docket are July's construction spending and auto sales for August. The Labor Department's much-anticipated nonfarm payrolls report for August will be released ahead of the open on Friday, capping off our three-day deluge of jobs data.

Market Statistics

Equity option activity on the Chicago Board Options Exchange (CBOE) saw 850,586 call contracts traded on Tuesday, compared to 605,908 put contracts. The resultant single-session put/call ratio arrived at 0.71, while the 21-day moving average was 0.79.

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Overseas Trading

Asian markets ended higher today, but not by much -- and certainly not enough to offset a brutal month of August. Seoul's benchmark index fell nearly 12% for the month, while stocks in Hong Kong turned in their biggest monthly drop since 2008. On the plus side, these steep declines have lured in bargain-hunters, particularly amid burgeoning hopes for additional U.S. stimulus. By the close, South Korea's Kospi rose 2%, Hong Kong's Hang Seng climbed 1.6%, Japan's Nikkei tacked on 0.01%, and China's Shanghai Composite ended fractionally higher.

Stocks in Europe are also on track to end a dismal month on a relatively high note, with major regional indexes firmly north of breakeven at midday. Germany's Allianz paced an advance in the insurance sector after an upgrade to "buy" at Goldman Sachs, while industrial group Bouygues surged in Paris after unveiling a rich share buyback plan. At last check, the French CAC 40 is up 1.7%, the German DAX has added 1.2%, and London's FTSE 100 is about 0.9% higher.

Currencies and Commodities

The greenback is trading just south of breakeven this morning, with the U.S. dollar index fractionally lower at last check. Meanwhile, crude oil futures have pulled back after finishing solidly higher on Tuesday, with the front-month contract down $1.04, or 1.2%, to trade at $87.86 per barrel. On the other hand, gold futures have extended yesterday's Fed-inspired climb, with the malleable metal last seen about $4.20, or 0.2%, higher at $1,834 an ounce.

Unusual Put and Call Activity:

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Every morning, our research staff analyzes the prior day and the overnight markets, and monitors the morning wires to give you an accurate preview of the day to come. If you enjoyed today's edition of Opening View, sign up here for free daily delivery, straight to your inbox, before the opening bell.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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