[R]9:45AM Market opened lower amid rate concerns and Motorola sales warning.[/R]
U.S. stock markets opened Friday trading session in the negative, reflecting rate concerns, raised by stronger-than-expected employment rate in December, steeply lower oil prices and a profit warning from Motorola. Best Buy (BBY: chart) rose 1.5% after the consumer electronics retailer said same-store sales rose 7%. Circuit City (CC: chart) erased earlier gains made on its report that December same-store sales rose 4.2%. In earnings news, Global Payments (GPN: chart) posted 11% profit rise in Q2 to 42 cents per share, up from 37 cents per share last year on 9% revenue growth The stock dropped 10.5%. In the first hour of trading, the Dow Jones industrial average fell 28.44, or 0.23%, to 12,452.25. The Standard & Poor's 500 index was down 4.90, or 0.35%, at 1,413.44, and the Nasdaq composite index was down 13.06, or 0.53%, at 2,440.37. Prices plummeted in the Treasury market, with the 30-year bond price dropping more than a full point after the jobs report. The yield on the benchmark 10-year Treasury note soared to 4.70%from 4.61% late Thursday.

[R]December employment rate increased more than expected.[/R]
Friday morning, the Department of Labor released its report on the employment situation in the month of December, showing that the U.S. economy added more jobs than economists had been expecting while the unemployment rate remained unchanged. The report showed that non-farm payrolls increased by 167,000 in December following an upwardly revised increase of 154,000 in November. Economists had expected an increase of about 100,000 jobs compared to the increase of 132,000 jobs originally reported for the previous month. The better than expected job growth reflected gains in several service-providing industries, including professional and business services, health care, and food services.

Service-providing industries added 178,000 jobs in December, more than offsetting a decrease of 11,000 jobs in goods-producing industries. The drop in jobs in goods-producing industries was largely due to a continued decline in manufacturing jobs. The Labor Department also said that the unemployment remained unchanged at 4.5 percent in December, which was in line with economist estimates. In the previous month, the unemployment rate edged up to 4.5 percent from 4.4 percent due to an increase in the size of the labor force. The report also showed that average hourly earnings increased by $0.08 or 0.5 percent in December to $17.04. With the increase, the year-over-year growth in average hourly earnings edged up to 4.2 percent in December from 4.1 percent in November.


[R]9:30AM NY – 2:30PM London The FTSE retreats on utilities, oil and gas stocks.[/R]
The FTSE 100 in London shed 16.8 points, or 0.3%, to trade at 6,270.2 in mid-morning session.

Decliners

Scottish & Southern Energy suffered heavy losses of 3% while International Power shed 2.3%. Kelda Group declined 1.3%. Cairn Energy also lost 2%, hit by weaker oil prices as crude dropped below $56 a barrel. Royal Dutch Shell was off 1% and BG Group lower by 1.5%.

Miners declined on copper prices which hit 9-month lows on continuing demand worries. BHP Billiton retreated 1.5% while Lonmin traded 1.4% lower.

CSR, Bluetooth maker for mobile phone components, continued to trade in the red after recently being accused of violating a wireless connections technology patent. It was down 2.5%.

Games Workshop Group were down by 8.4% following a profit warning. The company, which makes and sells figurines, announced that full year sales, and therefore profits, are likely to miss current market expectations.

Advancers

Support services firm Cape announced that earnings for the full year will top market expectations as its strong first half performance has continued throughout the second half of the year and will yield a positive set of full year results.

The retail sector attracted attention a day after well received results from fashion group Next. Merrill Lynch was moved to reiterate buy advice and the previous target price, with increased profit and earnings forecasts.

Supermarket leader Tesco was in focus, up 2.22%, as well as rival William Morrison, 1.39% higher, while J Sainsbury advanced 0.84% before the trading update next Thursday.


[R]9:00AM Market futures traded down, despite strong employment data.[/R]
U.S. stock futures remained in the negative territory even after stronger-than-expected December payrolls data eased concerns about an economic slowdown. The Labor Department released an employment report Friday which showed that the jobs market ended 2006 on a positive note. Total nonfarm payroll employment increased by 167,000 in December to 136.2 million, following increases of 86,000 in October and 154,000 in November. The number of new jobs added to the economy in December exceeded analysts'' forecasts for a gain of around 115,000. The Labor Department also said that the jobless rate fell from 4.9% at the beginning of the year to 4.5%. Average hourly earnings jumped by 0.5%, higher than the 0.3% rise expected. U.S. stock futures remained in the negative territory even after stronger-than-expected December payrolls data eased concerns about an economic slowdown.

Friday pre-market sentiment was considerably hurt by a profit warning from handset maker Motorola Inc., as well as downgrades of Dell Inc. and Exxon Mobil. A move by China to limit growth also contributed to the weakness. Motorola (MOT: chart) dropped nearly 10% in pre-opening hours as the mobile phone maker cut its Q4 earnings and sales forecast, citing lower margins and average selling prices due to an unfavorable geographical and product mix of mobile-phone sales. Dell Inc. (DELL: chart) fell 1.9% in pre-open after J .P. Morgan cut the computer maker to underweight from neutral on concerns over its enterprise business. Dow component Exxon Mobil (XOM: chart) was downgraded at Lehman to equal-weight on concern over slowing production growth. Elsewhere, shares of Circuit City Stores (CC: chart) and Best Buy (BBY: chart) gained 4% each after reporting same-store sales increase and ahead of quarterly earnings release. S&P 500 futures were down 5.6 points, below fair value. Dow Jones industrial average futures fell 38 points, and Nasdaq 100 futures fell 8 points.


[R]8:00AM Motorola cut its Q4 earnings and sales forecast.[/R]
Motorola Inc. (MOT: chart) slashed its Q4 earnings and sales forecast, citing lower margins and average selling prices due to an unfavorable geographical and product mix of mobile-phone sales. It sold 66 million units in the quarter, up 48% from last year and 23% from Q3 levels. The world''s No. 2 mobile phone maker said that Q4 sales will come in the range of $11.6 billion to $11.8 billion, lower than earlier guidance of between $11.8 billion and $12.1 billion.

The company projected earnings per share in a range of 13 cents to 16 cents a share, including 10 cents of charges on investment-related losses, stock compensation expenses and taxes. The profit projections came in below analysts’ expectations of earnings of 39 cents a share on sales of $11.99 billion.