Wall Street is attempting to shake off the pessimism that has been evident for the past four sessions, hinging its hopes on the domestic economy's strength and stimulus announcements that have been long time coming. Asian markets had a lackluster session, while sentiment in Europe is improving on the back of some positive earnings. The focus now shifts to the U.S. non-farm payrolls report due to be released ahead of the market open. If the report throws in a better than expected number, it may give traders a reason to return to stocks.
As of 6:15 am ET, the Dow futures are adding 68 points, the S&P 500 futures are firming up by 8.10 points and the Nasdaq 100 futures are moving up 19.25 points.
U.S. stocks declined on Thursday, stung by the disappointment handed out by the European Central Bank, which did not any announce any concrete measures to appease the markets.
On the economic front, the Labor Department is scheduled to release its monthly non-farm payroll report at 8:30 am ET. Economists expect non-farm payrolls for July to increase by 100,000 compared to the 80,000 jobs added in June, while the unemployment rate is expected to remain unchanged at 8.2 percent. The private sector is expected to have added 110,000 jobs.
The Institute for Supply Management is scheduled to release the results of its non-manufacturing survey at 10 am ET. The non-manufacturing index is likely to show a reading of 52 for July compared to 52.1 in June.
In corporate news, AIG (AIG) reported second quarter after tax operating income of $1.06 per share, up from 68 cents per share last year. Analysts had expected earnings of 57 cents per share.
NYSE Euronext's (NYX) second quarter earnings exceeded estimates by a penny, while its revenues trailed estimates.
Kraft Foods (KFT) reported second quarter operating earnings that exceeded estimates, the revenues trailed expectations. The company said its first half results are on track with its previous guidance for 5 percent net revenue growth and at least 9 percent operating earnings per share growth on a constant currency basis. The company also announced plans to spin off its North American grocery business on October 1st.
LinkedIn (LNKD) reported in line second quarter earnings, while its revenues exceeded expectations. The company raised its full year revenues guidance and also issues above-consensus revenue guidance for the third quarter.
Blue Nile (NILE) reported better than expected second quarter results, while its 2012 guidance was also healthy. ValueClick's (VCLK) second quarter earnings and revenues were ahead of estimates. The company issued above-consensus earnings guidance for the third quarter, while its revenue guidance was below estimates.
Fluor (FLR) also reported better than expected second quarter results, while it raised the low end of its 2012 earnings guidance.
The Asian markets ended on a mixed note, as the lackluster lead from Wall Street and the impending release of the U.S. non-farm report kept sentiment subdued in most markets in the region.
Japan's Nikkei 225 average closed down 98.07 points or 1.13 percent at 8,555. Australia's All Ordinaries ended 47.10 points or 1.10 percent lower at 4,243, with material stocks serving as a huge drag. Energy stocks also tumbled in the session.
Hong Kong's Hang Seng Index ended at 19,668, down 24.02 points or 0.12 percent. Meanwhile, China's Shanghai Composite Index added 21.61 points or 1.02 percent before closing up 2,133. The Malaysian, Indonesian and the Singaporean markets also ended higher for the day.
On the economic front, the results of a survey by Markit Economics and HSBC showed that the service sector in China expanded at a faster rate in July, with the services purchasing managers' index rising to 53.1 in July from 52.3 in June.
The major European averages are advancing strongly, with all the three major averages in the region showing strong gains. Bank and technology stocks are leading the rally.
In corporate news, French insurer AXA reported higher first quarter operating profits that were higher than analysts' expectation. German insurer Allianz also reported better than expected second quarter results. Meanwhile, Dexia reported a narrower loss for its first half.
IAG reported an operating loss for its first half, weighed by weakness in its Iberian unit and higher fuel costs. The company also reduced its 2012 outlook. Royal Bank of Scotland (RBS) reported a loss of 1.9 billion pounds for the first half, as it set aside 310 million pounds for covering costs related to a computer crash and mis-selling products to customers.
The service sector in the eurozone contracted, although at a slower pace, in July, according to the results of a survey by Markit Economics. The service sector index rose 0.8 points to 47.9 in July compared to the flash estimate of 47.6. The final composite output index came in at 46.5 in July compared to 46.4 in July. Meanwhile, service sector activity in the U.K. weakened in July, with the service sector index declining to 51 in July from 51.3 in June.
by RTT Staff Writer
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