U.S. stock futures were little changed earlier this morning, but now they've got the boost they needed. If before investors had disappointing results from Google and the upcoming January jobs report to mull over, now they have this headline: Microsoft Bids $44.6 Billion for Yahoo, a 60% over Yahoo!'s share price close Thursday.U.S. stocks on Thursday finished higher after troubled bond insurer MBIA maintained it could keep its AAA rating, alleviating some of the concerns for bond insurers being downgraded, thus affecting other financial institution that hold their securities. The Dow industrials climbed 207 points, or 1.67%, the S&P 500 was up 22 points, or 1.68%, and the Nasdaq Composite added 40 points, 1.74%.
Several important economic readings today could have an impact on the market as they could further shed light on the state of the economy:
Several important economic readings today could have an impact on the market as they could further shed light on the state of the economy:
- At 8:30 a.m. EST, January jobs report is scheduled for release. Nonfarm payrolls is expected to show 70,000 more jobs after the abysmal addition of 18,000 jobs in December. Unemployment rate is expected to remain at 5%, and hourly earnings to increase 0.3%.
- At 10:00 a.m., the Institute for Supply Management will release its nationwide manufacturing survey. The ISM is expected to slip to 47.0% in January from 48.4% in December. The December reading was the first sub-50 reading since January 2007.
- At the same time, the University of Michigan's updated survey on January consumer confidence is also due.
Meanwhile, OPEC oil ministers ignored pleas to pump more oil and agreed to keep production at present levels. They fear that a slowing global economy, especially the U.S., could weaken demand.
Overseas, Asian stocks finished mostly higher, but Japan's Nikkei closed down. European stocks rallied in midday trading.
Lots of corporate news this morning, first and foremost, of course, is Microsoft (NASDAQ: MSFT)'s bid for Yahoo! (NASDAQ: YHOO). The largest software maker, bid $44.6 billion in cash and stock for the largest internet portal. This bid is 62% above Yahoo's closing price on Thursday. Naturally, shares of YHOO are shooting up nearly 59% in premarket trading as it is difficult to see another company bidding higher.
Meanwhile, Google Inc. (NASDAQ: GOOG) shares are down over 5.7% in premarket trading (although they were down over 9% before the Microsoft/Yahoo! news) after the largest search engine reported disappointing earnings Thursday after the close. Excluding one-time charges, Google said it would have made $4.43 per share - a penny below the average estimate.
And after already speculating in that direction, Motorola (NYSE: MOT)'s board Thursday said that is would explore selling or otherwise disposing of its largest unit -- the handset one. MOT shares are up 14.8% in premarket trading.
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