Stocks Headed for Sharply Higher Open as Still-Weak Job Market Better Than Expected Last Month

09:07 AM Eastern Daylight Time, 09/03/2010 (MidnightTrader) --

U.S. PRE-MARKET INDICATORS

-Dow Industrial futures up 124 points.

-S&P 500 futures up 13 point.

-Nasdaq 100 up 25 points.

-Nasdaq-100 Pre-Market Indicator Up 12.9 at 1853.46.

GLOBAL SENTIMENT

Nikkei up 0.6%

Hang Seng up 0.4%

FTSE-100 up 0.9%

PRE-MARKET SECTOR WATCH

(+) Large cap tech: mostly firmer

(+) Chip stocks: mostly firmer

(+) Software stocks: mostly firmer

(+) Internet stocks: mostly firmer

(+) Drug stocks: mostly firmer

(+) Financial stocks: firmer

(+,-) Industrial stocks: mixed

(+,-) Auto stocks: mixed

(+) Airline stocks: firmer

(+) Retail stocks: mostly firmer

UPSIDE MOVERS

(+) TTWO (+12%) continues evening jump that followed surprise profit.

(+) FNSR (11%) continues evening jump that followed better-than-expected earnings.

(+) MTG (+3.3%) reports positive August operating statistics.

(+) ULTA (+9.3%) continues evening gain that followed an earnings beat and guidance mostly above the Street view.

(+) WAG (NA) says August same-store sales up 2.1%.

(+) FORTY (+28%) reports change of control.

(+) BP (+0.8%) puts latest spill costs at $8 billion.

DOWNSIDE MOVERS

(-) CLDX (-29%) regains rights to cancer vaccine as partner Pfizer (PFE) says program no longer a strategic priority.

(-) PSS (-0.9%) downgraded.

(-) CPB (NA) meets with earnings, guides mostly below Street view.

MARKET DIRECTION

Stock futures were immediately jolted higher, shaking off the doldrums seen earlier in the day and in the previous session, once a much better-than-expected August jobs report hit this morning. European stocks gained in response to the report. Asia had gained overnight. Stock futures were narrowly mixed just ahead of the data release.

Trading is likely to be volatile early and may thin dramatically as the U.S. begins a long Labor Day holiday weekend, with markets closed Monday.

According to Labor Department figures, the U.S. lost 54,000 jobs excluding the farm sector in August. The decline was smaller than the 105,000 loss expected by Wall Street economists polled by MarketWatch. Excluding census workers and other government employees, private payrolls grew 67,000 in August, more than doubling the 30,000 gain expected. That figure is down from a revised 107,000 private-sector gain in July.

The unemployment rate ticked higher to 9.6% in August from 9.5% in the previous month, meeting economists' expectations. This is the highest unemployment rate since May. Average hourly earnings increased 3 cents, or 0.2% to $19.08, slightly better than expected. Earnings are up 1.7% in the past year. The average workweek was unchanged at 34.2 hours.

Crude oil gained and gold futures fell in the wake of the job market news. Crude oil for October delivery gained 36 cents, or 0.5%, to $75.39 a barrel. Gold for December delivery was down $11.90, or 1%, to $1,241.60 an ounce.

Company news isn't as brisk as earlier in the week but there a few stocks drawing attention this morning.

Take-Two Interactive Software (TTWO) gained sharply in last evening's after-hours trading and is among the early volume toppers this morning, last trading up 12%.

The company reports Q3 non-GAAP EPS of $0.28 compared to a loss of $0.68 a year earlier and better than the Thomson Reuters mean analyst estimate for a loss of $0.06. Q3 revenue was $354.1 million, up sharply from the $94.9 million reported for the same quarter of fiscal 2009. The Street looked for $300 million.

The company guides for Q4 EPS of $0.20 to $0.30 on revenue of $270 million to $320 million. The Street is at a loss of $0.13 on $235 million in revs. For the FY, guidance is for $0.60 to $0.70 on revenue of $1.05 billion to $1.1 billion. The Street is at a loss of $0.11 on $967 million in revs.

Elsewhere, Walgreens (WAG) said it had August sales of $5.66 billion, an increase of 8.6 percent from $5.22 billion for the same month in 2009. Duane Reade stores, acquired in April 2010, contributed 2.8 percentage points to the total sales increase for the month. Sales in comparable stores (those open at least a year) increased 2.1 percent.

Total sales for the fourth quarter of fiscal 2010, which ended Aug. 31, were $16.89 billion, up 7.6 percent from $15.70 billion. Comparable store sales for the fourth quarter of fiscal 2010 increased 1.5 percent.