Stocks May Open Mixed Following Promising Employment Data, Slew Of Earnings - U.S. Commentary

  @ibtimes on July 16 2009 8:59 AM

RTTNews - Following a third straight day of gains, stocks are looking to open Thursday's session on a mixed note as traders digest some improving employment data and a batch of diverse earnings figures. The major index futures are on opposite sides of the unchanged mark, with the Dow futures up by 16 points.

First time claims for unemployment benefits continued to decrease in the week ended July 11th, according to a report released by the Labor Department, with initial jobless claims falling by more than economists had been expecting.

The report showed that jobless claims fell to 522,000 from the previous week's revised figure of 569,000. Economists had been expecting jobless claims to fall to about 530,000 from the 565,000 originally reported for the previous week.

However, analysts have pointed out that irregularities in the auto sector have continued to impact jobless claims, skewing the data artificially lower.

Also on the economic front today, traders will look to the Philadelphia Fed's manufacturing survey and the National Association of Home Builders' housing market index, which have also been the focus of investors due to their ripple effect on the economy.

In earnings news, JP Morgan Chase (JPM) reported second-quarter net income of $0.28 per share, compared with $0.53 in the second quarter of 2008. The results crushed Wall Street estimates, which forecast earnings of $0.04 per share.

Xilinx Inc. (XLNX) posted first quarter net income of $0.14 per share, compared to $0.31 per share in the same quarter last year. The results fell short of analyst expectations, which called for earnings of $0.19 per share.

Cintas (CTAS), Harley Davidson (HOG), and Marriott International (MAR) also offered a mixed bag of earnings reports. After the close of trading today, traders will look to results from tech giants IBM Corp. (IBM) and Google (GOOG).

Traders will also turn their attention to Capitol Hill this morning, with former Treasury Secretary Henry Paulson set to testify before Congress regarding the controversial Bank of America (BAC) and Merrill Lynch merger that took place late last year. The testimony is set to begin at 9:00 a.m. ET.

Following a strong start, stocks continued to move higher throughout much of Wednesday's trading session, largely fueled by trader reaction to the day's earnings data. The Dow closed up by 257 points at 8,616, the Nasdaq climbed 63 points to 1,863, and the S&P 500 rose 27 points to 933.

Crude oil futures are slipping in early commodities trading, falling by $0.62 to $60.92 a barrel after dropping by $2.02 to $61.54 per barrel in the previous session. The price of gold is also falling, drifting lower by $0.70 to $938.70 an ounce.

On the currency front, the U.S. dollar fell to two-week lows against the major European currencies earlier in the day, and is currently valued at $1.4139 against the euro while sitting at $1.6436 versus the pound. Against the yen, the dollar is recovering from a nearly five-month low set on Monday, now trading at 93.69 yen.

In overseas trading, stock markets across the Asia-Pacific region closed mostly higher on Thursday, with Hong Kong's Hang Seng Index climbing by 0.6 percent and Japan's benchmark Nikkei 225 Index moved higher by 0.8 percent.

The major European markets are also climbing, with the German DAX Index and the French CAC 40 Index advancing by 1.3 percent and 1.2 percent, respectively. The U.K.'s FTSE 100 Index is also moving higher, rising by 0.7 percent.

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