NEW YORK (CNN/Money) - On a day chock full of earnings reports, it was good news on the employment front that seemed to draw investors out of their funk.

The Labor Department reported Thursday morning that initial jobless claims for the week ending Jan. 11 fell by 32,000 to 360,000 -- well below the rise to 395,000 economists surveyed by Briefing.com expected. The implication is that December's poor employment report may be reversed in coming months.

It's the sort of report that had traders questioning the motivation for Wednesday's selloff. Stock index futures, which were indicating a flat open ahead of the report, turned into the green.

"I think the most relevant thing is the market was down 120 yesterday," said Janney Montgomery Scott vice president Larry Rice. "I think we're going to have a knee jerk reaction back up."

There was also good news on the earnings front from two Dow components -- General Motors (GM: Research, Estimates) and United Technologies (GM: Research, Estimates).

GM posted fourth-quarter earnings of $1.62 a share (once you exclude special charges), up $1.02 from the year-ago period and above the $1.53 analysts surveyed First Call expected. The No. 1 automaker issued its 2003 outlook last week, saying it expects lower earnings because of rising pension costs.

GM shares were 0.7 percent higher in premarket trading.

Aerospace manufacturer United Technologies, posted a fourth-quarter profit of $1.06, better than the $1.04 analysts expected and up from the 69 cents earned a year earlier.

United Technologies shares rose 9 cents to $64.40 Wednesday.

FleetBoston (FBF: Research, Estimates), the beleagured Northeastern bank, met expectations.

Internet portal operator Yahoo! (YHOO: Research, Estimates) reported better-than-expected fourth-quarter earnings late Wednesday. But the stock retreated after the report as the company projected first-quarter revenue that was below some of the more optimistic analysts' forecasts.

More importantly, the shares have risen 20 percent so far in 2003 and aren't far from their 52-week high. Credit Suisse First Boston analyst Heath Terry lowered his rating on Yahoo! to underperform from neutral. "While the quarter was a solid one and forward guidance positive, we believe that valuation is stretched," Terry wrote.

Yahoo! fell $1.08 to $18.50 in pre-market trading.

Apple Computer (AAPL: Research, Estimates) reported operating earnings of 3 cents a share, in line with estimates, but revenue was slightly below forecasts. The personal computer maker's shares were 2 percent lower in Europe.

The Consumer Price Index for December rose 0.1 percent, in line with November's gain, but lower than the 0.2 percent economists expected. The core, which excludes the volatile food and energy sectors, rose 0.1 percent, in line with expectations.

For details of Wednesday's selloff, click above

Traders are also keen to see the results of the January Philadelphia Fed Survey, due out at noon. Traditionally the month's first good look at the health of the manufacturing economy, economists surveyed by Briefing.com expect the survey's index to come in at 9, down from December's 11.3, but, because it is still above zero, still indicating growth.

But some market participants worry that the survey could come in worse than forecast. In Wednesday's Beige book -- the collection of annecdotal evidence on the economy put together by the regional Federal Reserve Banks -- the Philadelphia Fed reported that: "Overall business conditions appear to have changed little since November, with firms in most of the region's major manufacturing sectors generally reporting steady activity or sluggish growth."

The Dow Jones industrial average begins the day at 8,723.18, having dropped 118 points Wednesday as Intel's projection of reduced capital spending clouded the markets. The Nasdaq composite index was 22 points lower. (see chart for details)

Asian-Pacific stocks finished mostly lower Thursday, but the decline in Tokyo's Nikkei index was slight. After early losses European markets were moving into positive territory..

Treasury prices fell after the release of the economic reports, with the 10-year note yield up to 4.09 percent. The dollar retreated against the yen and euro.

The continued tension over Iraq and North Korea helped Brent oil futures rally 46 cents to $30.60 a barrel in London. Gold edged higher.

After the close, two more Dow components will give their results for the final three months of 2002. Both will be closely watched for any sign of recovery in the tech spending.

IBM (IBM: Research, Estimates), the world's largest computer company, is forecast to report a decline in fourth-quarter profit to $1.30 a share from $1.46 a share a year earlier. IBM shares dipped 1 percent in European trading.

Microsoft (MSFT: Research, Estimates), the largest maker of computer operating system software, is expected to show a decline in fiscal second-quarter income to 46 cents a share from 49 cents in the prior year. The company's shares were 1 percent lower in Europe.

Also due after the bell are workstation maker Sun Microsystems (SUNW: Research, Estimates) and online auctioneer eBay (EBAY: Research, Estimates).

For analyst comments, click here.