Stocks are looking to open weaker Friday, dragged lower by technology shares. Yesterday, tech giants IBM and Microsoft suggested that the recovery in demand in their businesses remains distant.

Old economy stocks are also being depressed by General Electric’s report that its first quarter profit dropped 21%.

The economic news is focused on trade today. It was reported that the U.S. trade gap grew to a new record of US$40.1 billion. The rise in the gap is being attributed to imports coming back up to speed following the settling of the West coast dock workers’ strike.

Meanwhile, Canada’s trade surplus dropped by $750 million in November, as exports declined in all major sectors. Exports fell 2.2% to $34.3 billion, but imports were unchanged at $30.2 billion. As a result, Canada’s trade balance with the rest of the world fell from a revised $4.8 billion in October to just over $4.1 billion in November.

In Europe, stocks are down led by its tech names such as Cap Gemini SA and Royal Philips Electronics NV. They are weaker following the Microsoft outlook. Naturally, this tech weakness is flowing over to the banks that hold their loans, too.

In London, the FTSE is down 29 points to 3,853. The CAC 40 has dropped 66 points to 3,076. The German DAX is 80 points lower at 2,974.

Overnight in Asia, stocks closed mixed. The Japanese Nikkei gained 81 points to 8,690, despite a government report showing that its economy is weakening. The Hang Seng dropped 129 points to finish at 9,614.

In M&A news, Canada’s Moore Corp is buying Wallace Computer Services to form one of the largest providers of print management solutions in the world. The combined company will be named Moore Wallace. Moore will pay approximately US$1.3 billion consisting of approximately US$606 million in cash, approximately US$470 million in Moore’s common shares, and the assumption of approximately US$210 million in debt. Wallace shareholders will be given the opportunity to elect to receive either cash or shares.

Also, it is being reported that buyout specialists Kohlberg Kravis Roberts & Co. may join the fight for Safeway plc.