MW: U.S. stock futures trade near two-week highs before data
By Steve Goldstein, MarketWatch
LONDON (MarketWatch) -- U.S. stock futures on Friday held near two-week highs ahead of data that is expected to show the fewest jobs lost in 14 months.
S&P 500 futures edged three-tenths of a point lower to 1,062.90 while Nasdaq 100 futures rose a half point to 1,719.70. Futures on the Dow Jones Industrial Average weakened by a point.
U.S. stocks surged on Thursday after upbeat economic data and positive results from Cisco Systems, sending the Dow Jones Industrial Average back over the 10,000 mark with a 203 point outburst. The S&P 500 rose 20 points and the Nasdaq Composite surged 49 points.
"The banks and retailers were reluctant to rally, which is a red flag and questions the strength of the rally," said Nick Kalivas, a strategist at MF Global. "However, the technology sector found legs and healthcare has found a firmer tone in recent days."
Attention on Friday turns to the Labor Department's 8:30 a.m. Eastern release of nonfarm payrolls data for October.
Seasonally adjusted payroll losses are projected to decline from 263,000 in September to just 150,000 in October, which would be the fewest jobs lost since July 2008.
The unemployment rate likely rose by a tenth of a percentage point to 9.9%, which would be the highest in 26 years. Some analysts are predicting a 10% or even a 10.1% jobless rate in October.
Michael Hart, a currency strategist at Citi, noted that turning points in payrolls usually ratify market developments rather than lead them.
"Generally, changeovers are associated with rises. However, equity uptrends are usually well in place by the time employment moves into positive territory," he said in a note to clients. "The notable exception to this was in 2002 when equities were declining sharply."
The market may also consider a weekend meeting from the Group of 20 countries in Scotland.
"Ahead of the G20 meeting policy officials appear to be going out of their way to reassure markets that fiscal stimulus packages will remain in place until a sustainable recovery has been assured," said strategists at BNP Paribas.
A weekend vote on healthcare legislation also may be eyed.
Starbucks (SBUX 19.70, +0.49, +2.55%) rose 3% in Frankfurt as the coffee chain improved its earnings outlook and reported a $150 million fiscal fourth-quarter profit.
The rescued insurance giant American International Group (AIG 39.28, +3.08, +8.51%) and private-equity group Blackstone (BX 13.87, +0.10, +0.73%) highlight Friday's planned results.
Overseas, Asian stocks rallied, with the Hang Seng climbing 1.6% in Hong Kong, while stocks in Europe hovered around the flat line.
Oil futures moved back above the $80-a-barrel mark, and yields on 10-year Treasury bonds fell 2 basis points to 3.51%.
The dollar was a bit weaker vs. both the yen and the euro.
