Stocks Back Down Ahead of Open

Futures are weak despite some solid earnings news.
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Stocks were lower early Thursday despite a flurry of relatively good earnings news, as traders reconsidered yesterday's late strength and put bets down ahead of the January employment report. Early returns from U.S. chain stores were solid.

Index futures recently showed the

S&P 500

trading 3 points below fair value, while the Nasdaq 100 was set for a 4-point decline. The 10-year Treasury bond was down 1/32 in price to yield 4.57%, while the dollar was higher against the yen and flat with the euro.

Oil extended a decline, losing 10 cents to $66.46 a barrel after plunging $1.32 on Wednesday.

Overseas stocks were mostly lower. In Europe, London's FTSE 100 was recently off 0.2% to 5791 while Germany's Xetra DAX eased 0.1% to 5718. In Asia, Japan's Nikkei rose 1.4% overnight to 16,711 while Hong Kong's Hang Seng fell 0.3% to 15,692.

On Wednesday, blue chips finished strong as

Boeing's

(BA) - Get Report

5% runup overshadowed earnings travails at

Google

(GOOG) - Get Report

. The

Dow Jones Industrial Average

gained 0.8% to 10,954, while the

Nasdaq Composite

added 0.2% to 2311.

In early earnings,

Tyco

(TYC)

reported a profit from continuing operations of $807 million, or 39 cents a share, on revenue of $9.71 billion for its first quarter. Analysts were forecasting earnings of 38 cents a share on sales of $9.81 billion.

For the second quarter, the conglomerate sees earnings of 40 cents to 42 cents a share, short of the 47-cent analyst consensus. But the shortfall should be made up in the full year, when Tyco expects to earn $1.85 to $1.92 a share, compared with estimates for $1.88 a share.

Royal Dutch Shell

(RDS-A)

earned $4.37 billion in the fourth quarter, down slightly from a year ago due to the impact of hurricanes Katrina and Rita. Sales fell 2% to $92.8 billion.

Starwood

(HOT)

said fourth-quarter earnings rose 59% from a year ago to $159 million, or 70 cents a share, while adjusted earnings of 71 cents a share were a nickel ahead of estimates. Quarterly revenue was slightly soft.

To view David Peltier's video take on today's premarket action, click here

.

French telecom gearmaker

Alcatel's

(ALA)

said fourth-quarter earnings rose to $414 million, or 30 cents a share, beating estimates by 2 cents. Alcatel posted 8% revenue growth and forecast a good first quarter.

Thursday is retail sales day on Wall Street, with most department store and specialty chains reporting January results. A handful of teen stores reported better-than-expected same-store sales Wednesday night, including

Aeropostale

(ARO)

,

Hot Topic

(HOTT)

and

American Eagle

(AEOS)

.

Coffee purveyor

Starbucks

(SBUX) - Get Report

said its earnings were $174.2 million, or 22 cents a share, in its first quarter. Adjusted earnings of 24 cents a share were 4 cents ahead of estimates.

Starbucks raised its full-year earnings target to 68 cents to 70 cents a share from its previous range of 63 cents to 65 cents. Both estimates include about 9 cents a share in stock-compensation expenses. Analysts, on average, expect earnings of 66 cents a share, including the 9 cents in option costs.