Some less actively traded names seeing bullish order flow: Wonder Auto Tech (WATG), Cheesecake Factory (CAKE), China Surveillance (CSR) Bearish order flow: Healthnet (HNT), Air Corp. (AAR), iShares Germany (EWG). Post Earnings: Aetna (AET) Pre-Earnings: CVS Ex-Div: American Electric Power (AEP), Exxon Mobile (XOM), Olin (OLN)

Stocks are indicated modestly higher after the Labor Department’s latest payroll report showed an unexpected decline in the unemployment rate Friday morning. Thirty minutes before the opening bell on Wall Street, stock index futures hint at a modest early gain for the Dow Jones Industrial Average.

The Labor Department reports that the US economy lost 20,000 jobs in January, which was worse than the 14,000 increase in jobs economists had predicted. Making matters worse, December numbers were revised down to show a loss of 150,000, down from the -85,000 first reported.

However, after a 269-point plunge in the Dow Thursday, a bad report had been discounted and the data contained a few bright spots. The unemployment rate unexpectedly fell to 9.7 percent from 10 percent. Economists had expected the rate of unemployed to stay steady. Average hourly earnings rose .3 percent, and better than expectations of +.2 percent.

Stock index futures edged higher on the data and bonds gave back some of the big gains seen the day before. The benchmark ten-year Treasury is down 5/32nd and now yields 3.63 percent.

The dollar added .61 to 89.61 against the Japanese yen. Euro woes continue. The euro-zone currency is down another .0007 to 1.3719 against the buck.

Crude oil added .40 to $73.44 a barrel. Gold is steady at $1063 an ounce.

Among the stocks to watch, Mastercard (MA) might bounce back from post-earnings losses suffered yesterday after Wells Fargo upgraded the stock to Outperform from Market Perform. Beazer Homes (BZH) gained 2.7 percent on earnings news. Tyson (TSN) is also up on earnings. However, Leap Wireless (LEAP) fell 5 percent after JP Morgan downgraded the stock to Underweight. Aetna (AET) and Sunoco (SUN) are trading lower on earnings.


Source: Bloomberg.com

Aetna (AET) is up $1.46 to $33.97 after a healthcare bill that appears set to clear the Senate with 60 votes doesn’t include a public healthcare plan option. While the House version of the bill does include one, reports are that a final bill is more likely to look like the Senate version. Consequently, some of the private insurers are trading higher and, in AET options, one player sold 5000 Jan 33 calls to buy 10K Jan 35 calls and this 1X2 call spread might be rolling up in strikes — doubling up on a winning trade. Separately, another investor bought 5,000 Jan $40 calls at a dime on ISE, which is an opening buyer, according to ISEE. 36K calls and 2,330 puts traded total, or about 4X the average daily.

*Scanning all single-stocks subject to 2500 contracts minimum call or put volume

Aetna (AET) is down 25 cents to $28 and 20K Nov 31 calls traded for an average of 92.5 cents per contract. They hit bid-side and were tied to shares at $27.90 — possibly a buy-write strategy. If so, the strategist collected about 90 cents, which brings the cost basis of owning AET to $27 per share. $27 is now the breakeven. The upside is to $31, or 14.8 percent, through the November options expiration (51 days).

Cigna (CI) is heading higher and calls are active amid relative strength in the health insurance names Tuesday. The sector is stronger after AP reported that a bipartisan group in the Senate held secretive talks and is working on a health care compromise that omits a public insurance option that the Obama adminstration favors. This might be viewed as a positive for CI, AET, CVH and private health plan providers. CI is up $2 to $28.44 and 17K options traded. Call volume accounts for 90%. Implied vols edging down to 47.5, from about 50.5. Earnings due out Thursday (before market).

*Scanning all single-stocks subject to 2500 contracts minimum call or put volume