Stock set to rise after Chinese, German data

By msnbc.com news services

Stocks are set to rise Wednesday after better-than-expected data out of China and Germany and as Greece inched closer to a debt deal, but recent market action suggested gains could be ephemeral.

Volatility was seen persisting, with low trading volume and mixed corporate earnings adding to the uncertainty.

China's factory sector expanded slightly in January, confounding expectations for a contraction and supporting hopes the world's second biggest economy will avoid a hard landing. Separately, Germany recorded its first rise in manufacturing output in seven months.

Greek Finance Minister Evangelos Venizelos said talks between Greece and its private creditors were "one formal step away" from a deal needed to avoid a messy default.

"Not only was the economic data out of Europe and China strong, but hopes are building that the situation will not deteriorate in Greece," said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.

"That's what the market wants, for fear to be contained and for things to proceed in an orderly fashion."

Amazon.com Inc slumped 9.1 percent to $176.74 in premarket trading a day after warning of a possible first-quarter loss and posting a steep drop in fourth-quarter profit.

Earnings continue to be a mixed bag. According to Thomson Reuters data, of the 204 companies in the S&P 500 that have reported results so far, 59.8 percent topped estimates, tracking below the beat rate at this stage of the earnings season in recent quarters.

Aetna Inc posted sharply higher quarterly profit in line with Wall Street's target early Wednesday.

Whirlpool Corp reported a drop in sales on weak global demand while Marathon Oil Corp swung to a fourth-quarter loss.

Facebook is expected to submit paperwork to regulators Wednesday morning for a $5 billion initial public offering and selected Morgan Stanley and four other bookrunners to handle the mega-IPO, sources said told Reuters unit IFR.

In economic news, private employers added 170,000 jobs in January, according to a new report released Wednesday from payrolls processor ADP.

Wall Street closed its best month since October on a flat note on Tuesday, pressured by weaker-than-expected economic reports, including on consumer confidence and home prices, pressured sentiment.

Reuters contributed to this report.