Daytrading, Eminis, Forex trading, Swing Trading MARKET ANALYSIS - 493426

A bigger than expected increase in the November non-farm payroll numbers should infuse some initial enthusiasm into the markets. Nonetheless, a rise in oil price is likely to take some sheen off any possible upside. The chip space is expected to see some sell-off following a warning from Xilinx ( | | | ) and a bleak outlook from National Semiconductor ( | | | ).

The major averages surrendered early gains and held close to the unchanged line till afternoon trading on Thursday. Thereafter, the indexes declined sharply to end firmly in negative territory. The Dow Industrials declined 30.

84 points or 0.25% to 12,278 and the Nasdaq Composite Index fell 18.17 points or 0.

74% to 2,428. The S P 500 Index ended down 5.61 points or 0.

40% at 1,407. Xilinx ( | | | ) may retreat after it lowered its third quarter sales growth guidance to a 2%-5% sequential decline from its earlier estimate of 2%-5% sequential growth. The company attributed the predicament to weaker than expected turns business in November from communication customers.

After retreating sharply since the May of this year through early August, the shares of the programmable logic chipmaker rebounded strongly and in the process recovered most of the lost ground. Xilinx is currently trading above its 50-day moving average of $25.56.

However, the stock broke an uptrend in the middle of November. Since August, the stock has also been underperfoming the technology weighted Nasdaq Composite Index. Any negativity surrounding Thursday's revenue warning may push the stock lower towards its support levels around $26.

5 and $24.70. Crude futures for January delivery are currently gaining $0.

99 to $63.48 a barrel. On Thursday, oil prices rose $0.

30 to $62.49 a barrel. Gold futures, which advanced $1.

10 an ounce to $637 on Thursday, have given back some ground and are currently trading at $634.70. The U.

S. dollar has weakened against both the euro and the yen. The dollar is trading at 1.

3335 versus the euro, while the greenback is fetching 115.133 yen. The major Asian markets were lower on Friday, with the exception of the New Zealand and Malaysian markets.

The Japanese Nikkei 22 5 average broke a two-day winning streak and declined 55.54 points or 0.34% to 16,418.

The index spent much of the day below the unchanged line, as the momentum faltered following the release of reports suggesting slower than forecast economic growth in the third quarter and a smaller than expected increase in the core private sector machinery orders. Technology stocks retreated following Thursday's strong advances. Auto stocks were mixed.

Honda and Toyota posted modest gains of 0.25% and 0.14%, respectively, while Hino Motors, Suzuki Motors and Nissan Motors declined.

Mitsui OSK Lines and Mitsui Sumitomo fell over 3% each. Yahoo Japan and Softbank receded 1.6% and 1.

41%, respectively. Among the gainers were Japan Tobacco, which jumped 3.97%.

Kobe Steel surged up 4.24%, while Japan Steel Work eased 0.23%.

Sapporo Holdings was up 5.56%. The Cabinet Office of Japan released on Friday its revised GDP growth estimates for the third quarter.

The nation's economy grew at a downwardly revised pace of 0.2% on a quarterly basis in the third quarter compared to the originally estimated 0.5% growth.

The annual third quarter growth was also revised to 0.8% from the 2% estimated earlier. The downward revision was mainly due to the slashing of estimates of capital expenditures and household consumption expenditures.

Another report released by the Cabinet Office revealed that the core private sector machinery orders, which exclude the volatile shipping orders, rose at a slower than anticipated rate of 2.8% in October following a 7.4% decline in September.

Hong Kong's Hang Seng Index languished in negative territory throughout Friday's session and closed down 103 points or 0.55% at 18,740. The index has been trending lower for the past two sessions.

Finance stocks were mostly lower, with index heavyweight HSBC Holdings dropping about 0.14%. Bank of East Asia slipped 1.

80% compared to a 0.64% decline by Bank of China Hong Kong. However, Hang Seng Bank edged up 0.

19%. The property space revealed mixed sentiment. Esprit Holdings and Li Fung were down 2.

39% and 3.19%, respectively. China Netcom lost 2.

45% compared to a 1.83% decline by China Mobile. However, China Mercantile Holding surged up 5.

58%. Cosco Pacific rose 2%. South Korea's Kospi also traded below the unchanged line throughout Friday's session before closing down 19.

87 points or 1.41% at 1,390. Friday's loss marked its fifth straight sessions of declines.

Analysts attributed the market weakness to the negative lead from Wall Street and fears over the strengthening of the Korean won. Samsung Electronics dropped 2.40%, while Hyundai Motor slipped 1.

37%. Kia Motors slumped a steeper 3.89%.

Financial stocks also came under severe selling pressure, with Kookmin Bank and Woori Financial losing 1.27% and 7.41%, respectively.

Australia's All Ordinaries, which opened with modest losses, declined further over the course of trading. The index lost about 35.20 points or 0.

65% to 5.415 at the close of trading. Energy and material stocks spearheaded the declines, with only gold, information technology, consumer staple and telecom stocks bucking the downtrend.

BHP Billiton and Rio Tinto retreated sharply. The four major banks also came under selling pressure. Among media stocks, News Corp.

and PBL firmed, while Seven Network and John Fairfax receded. India's Sensex succumbed to profit taking in Friday's session after a strong run up in the past couple of sessions. The index was one of the worst performers in the region, as it retreated about 172.

54 points or 1.23% to 13,800. Blue chip stocks came under heavy selling pressure.

In the broader market, oil gas stocks pulled back sharply, while public sector unit, metal, FMCG, capital goods and auto stocks saw significant weakness. The major European markets are trading lower on Thursday. The French CAC 40 Index is currently down 0.

76%. The German DAX Index is receding about 0.04% compared to a 0.

20% decline by the U.K. FTSE 100 Index.

In Paris, PPR, Mittal Steel, BNP Paribas, Bouygues, L'Oreal and Dexia are down over 1% each. Sanofi-Aventis, STMicroelectronics, Schneider Electric, Societe Generale and Pernod-Ricard are also showing weak sentiment. However, Altsom is advancing over 2.

40%, while EADS is gaining about 2%. Suez, EDF and Vinci are also posting noteworthy gains. Among Frankfurt stocks, Thyssenkrupp, Deutsche Post, Linde, Henkel, Commerzbank and Allianz are trading lower.

On the other hand, E.ON is rising over 1%. Other gainers include Altana, Bayer, Siemens, Deutsche Boerse and Schering.

The German Federal Statistical Office revealed on Friday that Germany's exports rose 22.6% in October from the year-ago levels. Meanwhile, imports increased by 17.

6%. However, on a monthly basis, exports on adjusted basis rose 2.6% in October compared to a 0.

2% decline in imports. Accordingly, the nation's trade balance revealed a surplus of 17.3 billion euros in October compared to a surplus of 11.

8 billion euros in October of 2006. The current account of the balance of payments also showed a surplus of 11.6 billion euros.

Another report released from Germany revealed that the nation's industrial production fell for the second straight month in October. Industrial production slipped 1.4% on a monthly basis in October.

The downside was mainly due to a 2.3% monthly decline in construction output and a 1.9% slippage in energy production.

In the U.K., Imperial Chemical Industries is the top gainer thus far in the session.

The stock is up about 2.30%. Bank stocks are mostly higher, while utilities are revealing mixed sentiment.

However, retailers are trading lower. Mining stocks are also revealing substantial weakness. Tobacco stocks are receding on profit taking.

The U.S. economy added 132,000 jobs in November compared to expectations for a 105,000 gain.

However, the Labor Department noted that the job growth for October was revised down to 79,000 from the earlier estimate of 92,000, while the September job growth was revised up to 203,000 from 148,000. The unemployment rate based on the household survey came in at 4.5% for October, which represents an increase of 0.

1% from October. However, November's jobless rate was better than the 5% rate witnessed in the year-ago period. Meanwhile, the average hourly earnings, which is an inflation measure increased by $0.

03 or 0.18% to $16.94 in November.

Goods producing industries lost 40,000 jobs in the month after losing 62,000 jobs in October. Meanwhile, service providing industries added 172,000 jobs in November after adding 141,000 jobs in October. The construction and manufacturing sectors lost 29,000 and 15,000 jobs, respectively in November.

This compares to a loss of 24,000 and 44,000 jobs, respectively in October. The retail trade sector added 20,000 jobs in November, extending the 2,000 gain in October. Professional and business services sectors continued to reveal job gains, as they added 41,000 jobs in November following an addition of 29,000 jobs in the previous month.

Education and health services added jobs at a strong pace of 41,000 in November compared to a 23,000 gain in October. The leisure and hospitality sector and government sectors added 31,000 and 18,000 jobs, respectively in November. The preliminary reading of the University of Michigan's Consumer Sentiment Index for the month of December is due out at 9.

45 AM ET on Thursday. The reading is expected to show that consumer sentiment held steady around the 92 levels in the month. The index came in at 92.

1 for November compared to the mid-month reading of 92.3 and October's 93.6.

Economists had expected the index to climb to 93.5 in November. The Expectations Index was at 82.

3, significantly lower than the Current Conditions Index, which was at 106. Inflation expectations 12 months out eased 0.1 points to 3%.

National Semiconductor ( | | | ) could be in focus after it reported that its second quarter profit declined to 27 cents per share from 32 cents per share in the year-ago period. Revenues were down 8% to $501.6 million.

The consensus estimates had called for earnings of 27 cents per share on revenues of $501.5 million. Looking forward, the company expects an 8%-11% sequential revenue decline, which is below the growth implied by the consensus estimate.

Edwards Lifesciences ( | | | ) may react to its announcement that it expects fiscal year 2007 earnings growth to be 12-14%. The company also reaffirmed its revenue guidance of $1.08-$1.

13 billion compared to the consensus estimate of $1.11 billion. Encysive Pharma ( | | | ) is likely to find some buying interest after the U.

S. FDA issued clearance to initiate and resume clinical studies with TBC3711, its endothelin receptor antagonist. Credence Systems ( | | | ) may trade higher after it said its fourth quarter loss narrowed to 2 cents per share from 23 cents per share reported in the year-ago period.

Sales rose marginally to $121.9 million. Looking forward, the company forecasts break even results to earnings of about 2 cents per share for its first quarter on sales of $118-$122 million.

Analysts, on average, estimate a loss of 1 cent per share on sales of $102.3 million for the quarter. Nanometrics ( | | | ) is likely to react positively to its announcement that it has received a favorable "Markman" decision from a U.

S. District Court in the patent infringement case initiated by Nova Measuring Instruments. Morgans Hotels Group ( | | | ) could gain some ground following its announcement that its board authorized the buyback of up to $50 million shares.

Hewlett-Packard ( | | | ) is likely to take the spotlight after it said it agreed to pay $14.5 million to settle civil charges arising from the broad room leak scandal. However, Central Garden Pet ( | | | ) is expected to come under pressure after it said its fourth quarter net income declined to 25 cents per share from 31 cents per share reported in the year-ago period.

The company's adjusted earnings were 49 cents per share, which were in-line with the consensus estimate. Revenues were up 30% to $420.8 million, ahead of the mean analysts' estimate of $383.

3 million. The company's fiscal year 2007 earnings estimate of $3-$3.10 per share was below the consensus estimate of $3.

38 per share. Boston Scientific ( | | | ) and Johnson Johnson ( | | | ) are expected to firm up following a FDA panel recommendation that drug coated stents do not increase the risk of blood clots. The Committee concluded that the drug-eluting stents are safe and that the safety concerns are far outweighed by evidence of clinical benefit.

Interpublic Group ( | | | ) may see some weakness after Wal-Mart Stores ( | | | ) dropped its unit as its ad agency. Chesapeake Energy ( | | | ) is likely to retreat after it announced that it will sell 30 million common shares in a public offering.