Stocks look to open higher on solid U.S. employment data; BlackBerry shares rise

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TORONTO - The Toronto stock market appears headed for a positive Friday session after U.S. job growth for January came in at the low end of expectations.

The U.S. Labour Department's non-farm payrolls report said the economy created 157,000 jobs last month. It also significantly revised upward the number of jobs created in the previous two months. The Labour Department said that a total of 127,000 more jobs were created than initially thought.

The jobless rate rose 0.1 of a point to 7.9 per cent.

The Canadian dollar was down 0.08 of a cent to 100.19 cents US, after the loonie closed above parity on Thursday for the first time in a week.

U.S. futures were higher as the Dow Jones industrial futures gained 88 points to 13,885, the Nasdaq futures were ahead 18.2 points to 2,743.2 while the S&P 500 futures rose eight points to 1,501.25.

Expectations had varied for job creation, ranging from 155,000 a week ago and rising as high as 170,000 in the last couple of days.

The positive jobs reading helped reassure investors who were surprised at data released Wednesday showing the U.S. economy shrank in the fourth quarter at an annualized rate of 0.1 per cent.

It will also give an indication of whether the strong trading start to the year can carry on after North American markets racked up decent gains for January.

The TSX is up a shade over two per cent for the month while the Dow industrials has jumped about 5.75 per cent as corporations delivered some better than expected earnings reports, U.S. politicians stopped the economy from going over the so-called fiscal cliff and agreed to an extension of the debt limit. And there were signs that China’s economy is reviving.

BlackBerry, the company formerly known as Research In Motion Ltd. (TSX:RIM)(NASDAQ:RIMM) was up about 2.3 per cent in pre-market trading in New York.

The stock had tumbled 17 per cent over the last two sessions following the rollout of its new BlackBerry 10 lineup. Part of the reason for the slide is profit taking after the stock ran up 50 per cent during January alone, and up 200 per cent from its 52-week low of $6.10 in September. But availability has become an issue as U.S. customers won’t be able to get the BlackBerry Z10 until March, a month later than in Canada.

In earnings news, Barbie maker Mattel Inc.’s fourth-quarter net income fell 17 per cent to $306.5 million, weighed down by a litigation charge. Removing the litigation charge, earnings were $1.12 per share, three cents short of analyst expectations.

Mattel’s revenue rose five per cent to $2.26 billion against expectations of $2.15 billion. Its stock was down 1.7 per cent in pre-market trading.

Exxon Mobil said fourth-quarter earnings rose six per cent to US$9.95 billion with help from higher profit margins in its refining business. Net income equalled $2.20 per share, compared with $1.97 per share a year earlier. Revenue was down five per cent to $115.17 billion,

Analysts expected Exxon Mobil Corp. to earn $1.99 per share on revenue of $115.22 billion.

Its publicly traded subsidiary, Imperial Oil (TSX:IMO), reported a slight increase in net income in the fourth quarter as lower expenses more than offset a decrease in revenue. Imperial said its net income in the latest period was $1.07 billion or $1.26 per diluted share. That was just above last year's $1.01 billion, or $1.18 per diluted share. Revenue fell to $7.8 billion from $8.1 billion.

Montreal-based paper maker Domtar Corp. (TSX:UFS) said quarterly net income dropped to US$19 million or 54 cents per share in the three months ended Dec. 31, down from US$61 million, or $1.63 per share, in the fourth quarter of 2011. Domtar’s revenue fell about $70 million to $1.33 billion.

Adjusted earnings dropped to $46 million or $1.31 per share, nine cents below expectations.

Commodity prices were mixed with the March crude contract on the New York Mercantile Exchange down 32 cents to US$97.17 a barrel.

April bullion was up $12.30 to US$1,672.90 an ounce while March copper was unchanged at US$3.73 a pound.

European bourses advances as three pieces of economic news for the 17 European Union countries that use the euro were all slightly better than hoped.

Unemployment was lower than feared in December, though still at uncomfortably high levels; a survey raised hopes of some growth in the manufacturing sector; and inflation unexpectedly fell, raising speculation of more help from the European Central Bank.

London's FTSE 100 index gained 0.52 per cent, Frankfurt's DAX was up 0.25 per cent while the Paris CAC 40 climbed 1.08 per cent.

Earlier in Asia, stocks were mixed after manufacturing data from China fell short of expectations. Industrial production is still growing, but at a slower pace, according to the government-sanctioned China Federation of Logistics and Purchasing. Its manufacturing index for January fell to 50.4 from 50.6 in December on a 100-point scale in which numbers above 50 indicate expansion.

Hong Kong’s Hang Seng fell marginally, South Korea’s Kospi dropped 0.2 per cent, Australia’s S&P/ASX 200 gained 0.9 per cent.

Japan’s Nikkei 225, meanwhile, was once again energized by the yen’s continued descent against the dollar. The index rose 0.5 per cent.

Organizations: TSX, Dow Jones, Labour Department Research In Motion Ltd. North American Exxon Mobil Corp. Domtar Corp. Imperial Oil New York Mercantile Exchange European Union European Central Bank FTSE 100 China Federation of Logistics and Purchasing

Geographic location: U.S., TORONTO, New York Canada Montreal London Frankfurt Asia China

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