9:00AM Market futures pointed higher, helped by upbeat employment report.
U.S. stock futures moved higher after a solid payrolls report indicated strength in the economy. The Labor Department reported that U.S. nonfarm payrolls increased by 111,000 in January, while the unemployment rate climbed to a four-month high of 4.6%. The new jobs added last month fell short of analyst expectations for a gain of 150,000. The report suggested that the jobs market started at a slower pace in 2007 and still remains in good shape.

Microsoft (MSFT: chart) also helped boost the sentiment, rising 1% in the pre-open after it was upgraded to buy from neutral at Banc of America Securities. Among other pre-market highlights, Amazon (AMZN: chart) shares dropped 2.8% on the margin worries. The retailer posted better-than-expected profit and sales and guidance for the year that exceeded analyst expectations. Chevron Corp. (CVX: chart) said its Q4 profit dropped 9% to $3.77 billion, or $1.74 per share, compared with net income of $4.14 billion, or $1.86 per share a year earlier. The earnings beat the average estimate by a penny. Revenue for the period totaled $47.7 billion, down 11% from $53.8 billion in the previous year. The stock inched up 0.01% in pre-opening trade.

Electronic Arts Inc. (ERTS: chart) rose 6.5% in premarket trading after the company said Q3 profit exceed expectations, despite a 38% decline in sales. On the downside in the early session, American depositary shares of Swedish company LM Ericsson ((ERIC: chart) fell 6.2% after the world''s largest wireless networking company gave a disappointing outlook. S&P 500 futures rose 3.4 points at 1,454.20 and Nasdaq 100 futures improved 2.75 points at 1,806.00. Dow industrial futures rose 24 points.

Jobs growth in January came in below expectations.
Friday morning, the Department of Labor released its closely watched report on the employment situation in the month of January, showing that the U.S. economy added fewer jobs than economists had been expecting. The report showed that non-farm payroll employment rose by 111,000 in January following an upwardly revised increase of 206,000 in December. Economists had expected payrolls to increase by 150,000 compared to the increase of 167,000 originally reported for the previous month. The Labor Department said that the job growth was largely due to a continued increase in jobs in service-providing industries, which added 104,000 jobs in January following an increase of 209,000 in December. The growth in service jobs reflected notable increases in jobs in the education and health services, professional and business services, and leisure and hospitality industries.

However, the report also showed a continued decline in manufacturing jobs, which fell by 16,000 in January after falling by 18,000 in December. A decrease of 23,000 jobs in the motor vehicles and parts industry contributed to the drop in manufacturing jobs. Additionally, the Labor Department said that the unemployment rate edged up to 4.6 percent in January from 4.5 percent in the previous month. The increase came as a surprise to economists, who had expected the unemployment rate to remain unchanged. The higher unemployment rate was partly due to an increase in the size of the labor force, although the number of people that were unemployed also rose. The report also showed that employees'' average hourly earnings rose $0.03 or 0.2 percent to $17.09 in January. Economists had been expecting a slightly larger increase in wages of about 0.3 percent. With the increase, wages were up 4 percent compared to January of 2006.


8:00AM NY-7:00PM Mumbai Sensex surges to an all-time high Friday on large-cap rally.
The Sensex on BSE closed 136.59 points, or 0.96%, higher, at 14,403.77. The market-breadth was strong as 1,396 shares advanced, 1,274 declined and 52 remained unchanged. Of the 30 stocks in the Sensex, 23 advanced, while the rest declined. The turnover on BSE was Rs 5,433 crore, compared to Rs 4,012 crore on Thursday. On NSE, the turnover amounted to Rs 10,257.56 crore, higher than 8,033.66 crore on Thursday.

Economic news

Wholesale inflation in India rose to 6.11% in the week ending January 20, slightly higher than the expected 6%, on an increase in the prices of manufactured products and foods.

The rupee touched one-year high in the morning trading supported by the rally in the stock market and weaker dollar. One dollar fetched Rs 44.10/11.

IBM announced a 37% growth in 2006 in India, compared with the same period earlier led by sale of computer servers, storage, software and services.

Trading highlights

BF Utilities was the most active stock with a turnover of Rs 232.32 crore followed by Gitanjali Gems and Auto Industries.

Advancers

Bharti Airtel led the gainers, up 5.39% to Rs 771.05, on a volume of 5.72 lakh shares. Reliance Communications also advance 3.54% to Rs 490.55, as it is expected to report strong growth in new subscriptions.

L&T surged 4.89% to Rs 1,679, rallying to an all-time high of Rs 1,690. HDFC was up 3.74% to Rs 1,735.05, and Reliance Energy gained 1.83% to Rs 534.10.

IT stocks were in focus. Wipro gained 3.38% to Rs 643.45, TCS added 0.53% to Rs 1,299.40 and Satyam Computer added 3.53% to Rs 490.90.

Gujarat Ambuja Cements surged 2.48% to Rs 142.80, as it posted its Q3 results. Net profit quadrupled to Rs 337 crore from a year ago. Net sales rose 90% to Rs 1,329 crore from the previous period.

Tata Steel rebounded after plunging sharply by around 12% in the past two sessions, on worries that may have over paid for British steel company Corus. Tata Steel gained 1.14% to Rs 462.95. Maruti Udyog finished 0.61% higher to Rs 945.05, as the company lifted the prices of its cars by up to Rs 12,000.

Decliners