Already reeling from

Lucent's

(LU)

profit

warning, the stock market is now dealing with a hotter-than-expected

employment report

.

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Message Boards.

Lucent

The

Labor Department

reported that payrolls increased by 315,000 jobs in December, well above the 224,000 predicted by economists in the

Reuters

poll. The jobless rate stayed steady at 4.1%. But hourly wages gained 0.4%, a tenth of a percentage point higher than expected.

"This is not a good number," said Jim Benning, a trader at

BT Brokerage

.

The higher-than-expected wage gains could lend some weight to talk of a 50-basis-point rate hike at the

Fed's

next meeting on Feb. 1 and 2. It could also reapply the pressure on financial stocks, which enjoyed a bounce yesterday from steep losses earlier this week. And, of course, it shouldn't do anything to alleviate the selling pressure in the technology sector, which is already nearing corrective levels and now reeling from Lucent.

But it's not shaping up to be as simple as that. The

S&P 500

futures have reacted to the jobs report with the volatility we've come to expect from this market, initially plunging on the news, then storming back toward fair value, then easing off again.

"They look all over the place," Benning said. At 9:05 a.m. the

S&P 500

futures were up 5.1. That sounds pretty strong, but it's actually about 8 points below fair value, and indicates a negative open. Nonetheless, more than a few tech stocks were getting bids in the premarket.

Lucent was lately trading at 51 on

Instinet

, down from a New York close of 69 1/2.

The bond market was moving lower. The 30-year Treasury was off 17/32 to 93 23/32, putting the yield at 6.57%.

It can't hurt the outlook for U.S. stocks that, for the first time this week, trading screens across the rest of the globe aren't awash in red. In early afternoon trading, the large European bourses were bouncing back strongly, paced by Frankfurt's

Xetra Dax

, which was up 208.91, or 3.2%, to 6683.83. The Paris

CAC

was 66.39 higher, or 1.2%, to 5516.50, while London's

FTSE

was up 29.1 to 6476.3.

The euro was giving back some of its recent gains against the dollar, lately trading at $1.0285.

Asian markets also regained their footing overnight.

In Hong Kong, after losing about 13% of its value in the past two sessions, the

Hang Seng

closed up 252.40, or 1.7%, to 15,405.63.

In Tokyo, the

Nikkei

gained 25.14 to 18193.41.

The greenback nestled around 105.30 in Tokyo trading after nearing a seven-week high earlier in the session. Some currency traders are now starting to talk about a near-term target of 106.50 yen, and then, 110 yen. The dollar was lately trading at 105.22 yen.

For a look at stocks in the preopen news, see Stocks to Watch, now published separately.