Stocks look set to rally today, led by retailers and automakers.

An analyst survey forecasting that the economy may pull out of recession by March is boosting optimism.

News that retailers Wal-Mart Stores Inc., Limited Inc., and Talbots Inc. have exceeded December sales forecasts also has traders bullish.

In the auto group, General Motors Corp. is raising guidance for its fourth quarter results. DaimlerChrysler on the other hand says it may have a tough time making its numbers. Canadian auto parts firm Magna reaffirmed its outlook for earnings for both the full year and fourth quarter.

The economic news is also supportive. U.S. initial jobless claims fell by 56,000 last week, much more than analysts expected. This is also supporting hopes of a quick recovery. In other enews, U.S. December import prices dropped 0.9%.

In Canada, strong construction intentions in both the housing and non-residential sectors pushed the monthly level of building permits past the $3.5 billion mark in November, up 7.1% from October, to the highest monthly level since January 2001.

The Help-wanted Index dropped 5.3% from November to 126. Compared with December 2000, the national index was down 27.6%, the largest year-over-year decrease in recent years.

In Europe, however, stocks are weak. The DaimlerChrysler news is weighing on stocks there, along with weakness in Vodafone Group plc and Reuters Group plc. The Bank of England left interest rates unchanged. The FTSE is down 27 points to 5,202. The CAC 40 is off 40 points to 4,547. The DAX is down 64 points to 5,223.

Overnight in Asia, stocks were also weak. The Nikkei dropped 126 points to 10,538. The Hang Seng gave up 185 points to 11,256.

In earnings news, TLC Laser Eye Centers Inc. reported a net loss of 88¢ for the second quarter compared to 74¢ last year.