Market Preview: Choppiness Ahead

Meantime, Sam Stovall, chief U.S. equity strategist at S&P Capital IQ, is expecting volatility to pick up in the near term. He summed up his take on the recent economic data as "one step forward, two steps back" and thinks investors may be in for more disappointment on Friday when the jobs report finally arrives.

"Earlier payroll gains were likely a combination of accelerated hiring due to warmer-than-normal weather, as well as corporate America's need to play catch-up after incorrectly assuming a limited pick-up in aggregate demand," he wrote. "We therefore think equity markets may remain choppy in the near term, due to Friday's numbers and upcoming French and Greek elections that could unseat those who have already embraced austerity."

As for Thursday's scheduled news, Dow component Kraft Foods(KFT) is slated to report its first-quarter results after the closing bell, and the average estimate of analysts polled by Thomson Reuters is for earnings of 56 cents a share in the March-ended period on revenue of $13.05 billion.

The big news at Kraft, of course, is the company's plan to split into two separate publicly traded entities with the North American grocery products company retaining the Kraft Foods name and the global snack foods company to be called Mondelez International. The separation is expected to be completed by the end of the year.

Kraft's stock is up more than 6% so far in 2012 and 17.5% in the past year, hitting a 52-week high of $39.99 on Tuesday, so the company doesn't have a lot of leeway for a miss. The sell side is very bullish with 13 of the 18 analysts covering the stock at either strong buy (6) or buy (7) and the median 12-month price target sitting at $44, implying potential upside of X% from Wednesday's close at $XX.XX.

At current levels, the shares are trading at a forward price-to-earnings multiple of 14.2X, slightly more expensive than 13.3X for the S&P 500 as of Friday's close. The stock's forward annual yield is a healthy 2.9%.

JPMorgan boosted its rating on Kraft on Monday, going to overweight with a $45 price target, citing a belief that the dividend yield for the grocery company's stock will be above 4%, possibly even approaching 5%. The firm also said the sum-of-the-parts valuation remains appealing.