Options Trading News

May 3, 2013  Fri 7:10 AM CT

The S&P 500 is poised for a potential breakout as the market holds its breath before April's non-farm payroll report.

Futures are down slightly this morning after closing at yet another record high yesterday. European markets are little-changed, while Asian indexes were mixed overnight.

Economists expect that the Labor Department will announce that 155,000 jobs were added last month, up from 88,000 in March. Perhaps even more important is the private-sector segment of the report--excluding the public sector--forecast to show growth of 166,000.  The numbers will be released at 8:30 a.m. ET.

Equities have advanced recently despite less-than-stellar data as the market focuses on the longer-term growth story. Sentiment has also been supported by strong earnings in the housing and automotive industries, two key drivers of the U.S. economy.

The most interesting move this morning before the payrolls report is the 4 percent rally in copper, often viewed as a bellwether for global growth. Silver is also up more than 1 percent, while gold and oil advanced half a percent. Agricultural products are mostly higher as well.

Trading in the foreign-exchange market is reflecting a similar pattern of risk appetite, with the euro and Australian dollar gaining and the Japanese yen lower across the board.

Our researchLAB market screener shows that equity flows have started to move in the same direction, with stocks in Asia, Germany, and Russia outperforming the S&P 500 in the last week following months of underperformance. Conservative sectors such as health-care and staples have also begun to lag.

In company-specific news, business-networking company LinkedIn is indicated to fall about 10 percent on a weak second-quarter revenue forecast. Insurance giant American International Group is up about 2.5 percent after first-quarter results surpassed estimates by a wide margin. Software maker Teradata is poised to drop some 11 percent after earnings and revenue missed consensus.
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