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Pre-Market: Hewlett-Packard Falls Further After Announcing Thousands More Job Cuts; Stocks Set to Rise


Plus, it's feast for The Gap and famine for Aeropostale.

US stocks were higher Friday morning as investors await fresh data on the housing market. Shares of Hewlett-Packard Company (NYSE:HPQ) fell further this morning after yesterday's reports that the company plans let go thousands of workers.

After ending Thursday higher, stocks are poised for gains ahead of Memorial Day weekend. Futures on the Dow Jones Industrial Average (INDEXDJX:.DJI) advanced 0.07% to 16,540. S&P 500 (INDEXSP:.INX) futures rose 0.10% to 1,892.10. The index gained 14 points from last week's close so far this week, after a two-week losing streak. Nasdaq (INDEXNASDAQ:.IXIC) futures were up 0.15% at 3,653.50.

The only major data point on today's economic calendar is expected to show that the pace of new-home sales advanced to an annual rate of 420,000 in April, up from 384,000 in March.

As CEO Meg Whitman struggles to turn her PC company around, Hewlett-Packard will eliminate between 11,000 and 16,000 jobs on top of the 34,000 cuts that it announced as part of its restructuring plan. The Silicon Valley giant, which employs more than 300,000 people, will focus less on building PCs and more on enterprise networking and software. After plunging more than 2% yesterday, HP's stock is down 0.3% in pre-market trading despite a small after-hours recovery.

Shares of eBay Inc (NASDAQ:EBAY) dropped 0.91% as several state attorneys general investigate a recent cyber attack against the online auctioner. Earlier this week, eBay advised users to change passwords after a database containing personal information was hacked. AGs in New York, Illinois, Florida, and Connecticut said that they will investigate the matter. New York AG Eric Schneiderman expects eBay to offer free credit monitoring to customers affected by the breach, as Target (NYSE:TGT) did for some customers following last year's leak of millions of customers' data.

The Gap Inc. (NYSE:GPS) gained 0.34% in pre-market trading after topping earnings estimates for the quarter that ended on May 3. Net profit was $0.58 per share, down from $0.71 per share a year earlier. This beat analyst expectations by a penny. Sales rose 1% to $3.8 billion, helped by huge gains at its Old Navy chain.

The Gap's competitor Aeropostale Inc. (NYSE:ARO) plunged after forecasting a wider-than-expected loss for the second quarter. The teen retailer said that it is likely to lose between $0.55 and $0.61 per share. Wall Street analysts predicted a loss of $0.51 per share. The company's stock dropped 15.3% on the news.

European stocks were mostly in the green today. Germany's Ifo institute's business index fell to 110.4 this month from 111.2 in April. This is the lowest level for the index so far this year.

Europe's periphery got a vote of confidence from the major credit ratings agencies today. Standard & Poor's upgraded Spain's credit to BBB, putting the country's debt out of junk status. S&P says that outlook is stable, citing improving competitiveness and structural reforms. Fitch upgraded Greece to B from B-.

Twitter: @vincent_trivett

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