Market Preview: Bulls in Control

NEW YORK (TheStreet) -- The only appropriate sentiment about stocks after a breakout session like Thursday's is: Wow!

The bulls now look to be firmly in control with the all three major U.S. equity indices closing at multi-year, pre-financial crisis highs. Forget slowing earnings growth. Forget the sluggish economy and the fiscal cliff. For a day at least. The market's interpretation on Thursday was that European Central Bank President Mario Draghi was making good on his promise to do "whatever it takes" to keep the eurozone together, and stocks reaped the rewards.

Now it's up to the August jobs report to keep the momentum going. The consensus view is for nonfarm payrolls to have swelled by 130,000 last month, according to Briefing.com. An in-line number would be a comedown from July's total of 163,000, but still better than the sub-100,000 readings seen in April, May and June.

Thursday's stronger than expected ADP employment change report had Capital Economics wondering if its estimate for the government's read on August is too low but the firm doesn't think even a blowout performance would put the brakes on QE3.

"The 201,000 increase in the US ADP private sector employment survey in August was the biggest gain in five months and suggests that our forecast that official non-farm payroll employment rose by around 100,000 in August may be too pessimistic," Capital Economic said. "But even if payrolls rise by something similar to July's 163,000 gain, we wouldn't expect this to persuade the Fed to hold fire at next week's policy meeting."

The firm, which was poking holes in the European Central Bank's bond-buying plans even before the details arrived on Thursday, offered up a similarly skeptical view in the wake of the outline ultimately offered up by ECB President Mario Draghi. Chief among its criticisms is the strong conditional nature of the proposed bond buys as member countries must first ask for help and the fact that the purchases will be sterilized.

"None of this is to say that the ECB's actions are not encouraging," wrote analyst Jennifer McKeown. "Indeed, the extra money that it can provide could prove crucial. But the Bank is still not prepared to do governments' work for them and questions remain over whether those in the periphery and the core are prepared to do what is required of them."

Aside from the August jobs report, Friday is a slow day for scheduled news. The only notable earnings reports are Comverse Technology (CMVT), Kroger Co. (KR), and lululemon Athletica (LULU).

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