What You Need To Know Ahead Of The Jobs Report
Stocks were lower even after a large drop in initial claims earlier in the
session.
Traders fear an interest rate rise may
come as early as June and
are wary ahead of the employment number
early Friday — the consensus is 5.7%. For the third consecutive week, initial
weekly claims fell by 25,000 to 315,000–the lowest level since October 2000.
Productivity levels met market expectations of 3.5% while labor costs rose by
0.5%.
If tomorrow’s report comes in
in-line, few will be surprised and this also implies the Fed will have some
wiggle room. If the report is stronger than expected, however, the expectation
is that the Fed will have to be more aggressive is raising rates.
Fed chairman Alan Greenspan warned that
a rising budget deficit and trade protectionism pose great threats to the
current economic recovery. Metals companies Alcoa
(
AA |
Quote |
Chart |
News |
PowerRating) and US Steel
(
X |
Quote |
Chart |
News |
PowerRating) fell after Greenspan said that China’s economic growth may slow, hurting
demand.
The Bank of England
raised interest rates by 25 basis points to 4.25% over inflation concerns. The
ECB met in Helsinki and left interest rates intact at 2% with President JC
Trichet citing worries over rising oil prices. The Nasdaq dropped below its
200-day moving average for the third time in five trading sessions.
Wal-Mart
(
WMT |
Quote |
Chart |
News |
PowerRating)
reported same-store sales up 4.4% for the month of April. WMT expects a 5%
increase for May. Target
(
TGT |
Quote |
Chart |
News |
PowerRating) provided similar numbers, with
same-store sales up 4.9% for April. TGT expects a 5% increase for May.
Corporate profits for Q1 are up
an average of 26.7%.
Lea Fastow, the wife of former
Enron financial chief Andrew Fastow, was sentenced to 1 year in prison for
filing a false tax form.
Ad rates for tonight’s last
episode of the hit series “Friends” are $2 million for a 30-second spot.
Sotheby’s said that Picasso’s “Boy With A Pipe” sold for $104 million
After the close, Pixar
(
PIXR |
Quote |
Chart |
News |
PowerRating)
reported 0.46 vs 0.39, 0.07 ahead, NVIDIA
(
NVDA |
Quote |
Chart |
News |
PowerRating) beat by
0.02 and beat on revenues; Univision
(
UVN |
Quote |
Chart |
News |
PowerRating) beat by a penny.
| Dow | -69.69 |
10241.26 |
| S&P 500 |
-7.57 |
1113.96 |
| Nasdaq | -19.52 |
1937.74 |
Strong today were Semis
(
SOX.X |
Quote |
Chart |
News |
PowerRating) +0.05%.
Weak sectors were Gold
(
HUI.X |
Quote |
Chart |
News |
PowerRating) -3.43%; Airlines
(
XAL.X |
Quote |
Chart |
News |
PowerRating)
-3.27%, Hardware
(
HWI.X |
Quote |
Chart |
News |
PowerRating) -2.36%, and Disk Drives
(
DDX.X |
Quote |
Chart |
News |
PowerRating)
-2.18%.
Economic news releases today
included initial claims that fell by 20,000 to 315,000 and productivity levels
that met consensus at 3.5%.
10-year Notes were -075
at 109 265
The dollar
was +0.57 at 89.88
Gold was down 3.75 at
387.85
Crude Oil was -0.14 at
39.37
Volume was 1.5 billion
on the NYSE, and 1.75 billion on the Nasdaq.
Market breadth was positive.
| NYSE | Issues | |
| Advancing |
635 | Up Vol 297 |
| Declining | 2720 | Down Vol 1202 |
| Ratio | 4.28 |
4.04 |
| Nasdaq |
||
| Advancing |
916 | Up Vol 459 |
| Declining |
2249 | Down Vol 1263 |
| Ratio | 2.45 |
2.75 |
Stocks in the news:
Citibank
(
C |
Quote |
Chart |
News |
PowerRating) said the SEC is
investigating its accounting practices in Argentina for 2001 and 2002.
THQ
(
THQI |
Quote |
Chart |
News |
PowerRating) reported earnings of $5.4
million, beating analysts’ estimates by 2 cents with revenue rising to $123
million.
King Pharmaceuticals
(
KG |
Quote |
Chart |
News |
PowerRating) posted a net
loss of $111.1 million, well below analysts’ estimates with revenue down 14% to
$290.6 million. Wachovia downgraded KG to “market perform” on the news.
General Dynamic’s
(
GD |
Quote |
Chart |
News |
PowerRating) Electric Boat
subsidiary was awarded a $229 million contract by the US Navy for submarine work
.
Brice Wightman
bricew@tradingmarkets.com