Stocks crawled toward a mixed open Friday as the possibility of a transatlantic telecom merger goosed the tech sector but did little for blue chips. Index futures recently showed the S&P 500 trading a point below fair value, while the Nasdaq 100 was set for a 5-point gain. The 10-year Treasury bond was up 1/32 in price to yield 4.73%, while the dollar rose against the yen and euro. Late Thursday, telecom equipment suppliers Lucent ( LU) and Alcatel ( ALA) confirmed they are discussing a merger, reprising negotiations that broke off five years ago over the issue of who would acquire whom. The merger talks extend a wave of consolidation that has swept telecom in recent months, the last example being AT&T's ( T) agreement to acquire BellSouth ( BLS). The latest linkup is being billed as a merger of equals, even though Alcatel's market capitalization is about 40% greater than Lucent's. Also supporting tech was the placement of Google ( GOOG) into the S&P 500, a move that will require index fund managers to buy the stock. The elevation of Google, whose $101 billion market cap makes it one of the biggest U.S. tech companies, has been rumored for months. Oil was little changed after sprinting toward $64 a barrel Thursday on concerns about the reliability of supplies from Nigeria and Iran. In electronic Nymex trading, crude for May delivery was down 11 cents to $63.80. Higher energy and bond yields meant pain for stocks on Thursday, with the Dow Jones Industrial Average falling 0.4% to 11,270 and the Nasdaq Composite losing 0.1% to 2300. For the month to date, the Dow is up 2.5%, while the S&P 500 has risen 1.6% and the Nasdaq has gained just under 1%. Overseas markets were mostly higher. London's FTSE 100 was recently up 0.6% to 6025, while Germany's Xetra DAX rose 0.3% to 5962. In Asia, Japan's Nikkei added 0.4% overnight to 16,561, while Hong Kong's Hang Seng eased 0.4% to 15,716. To view David Peltier's video take on today's premarket action,
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On the economic docket Friday is a Commerce Department report on February durable goods, due at 8:30 a.m. EST, and a reading on February new home sales, due at 10 a.m. Economists are looking for a 1.3% rise in durables and a 1.21 million annualized rate on the housing number. Palm ( PALM) rose late Thursday after saying third-quarter earnings rose sevenfold to $29.9 million, or 28 cents a share, on a 36% jump in revenue. Adjusted earnings of 19 cents a share were 3 cents better than expected. Wendy's ( WEN) spinoff Tim Hortons priced its much-anticipated initial public offering at $23.16 apiece, raising about $672 million. The stock will make its debut Friday on the NYSE under ticker THI. Campbell Soup ( CPB) is exploring alternatives for its Irish and U.K. operations, saying the portfolio is "fragmented" and hasn't met growth targets. The businesses generate annual sales of half a billion dollars. Cephalon ( CEPH) could see pressure after an FDA advisory panel recommended against approval of its Sparlon for attention deficit hyperactivity disorder. Committee members cited concerns about the drug causing a potentially fatal skin disease. 3Com ( COMS) said its third-quarter loss narrowed to $32.8 million, or 8 cents a share, from $53 million, or 14 cents a share, a year ago. Sales rose 10% to $177.6 million, about $12 million below estimates.