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It was a galant effort in today’s trading session to have the major indices close in the green today, but it was all for naught. Well except the small-cap Russell 2000, which finished up +0.23% — but it’s still down -4% over the past five trading days. The Dow was just a smidge under, -0.03%, while the Nasdaq and S&P 500 were in tandem all day, -0.12% and -0.13%, respectively.
We don’t know much through the course of this trading session we didn’t already know when the opening bell rang: Jobless Claims, both new and longer-term, both came below projections yet again, which are already historically low. And September Job Cuts from the Challenger survey were drastically reduced month over month. Normally, these would be cause for celebration in the markets, but not when investors are counting on souring data to help the Fed decide not to raise keep interest rates so high.
The 10-year bond yield continues to hang around 16-year highs at 4.712% — off the 4.8% we saw yesterday, but marginally. The 2-year is at 5.15%, so the inversion is still in place — and not notably narrowing as it had been earlier today: this morning we were seeing a spread of around 25 basis points (bps), now it’s back up over 40. More directly, these high yields are offering a real return sans risks associated with the equities markets. So while investors protect their windfall gains from companies like NVIDIA (NVDA - Free Report) earlier this summer, it’s clearly helping take a bit out the stock market.
Levi Strauss & Co. (LEVI - Free Report) kept its perfect earnings surprise streak alive since its IPO in 2019, though the American icon apparel retailer beat estimates by only a penny to 28 cents per share — well off the 40 cents posted in the year-ago quarter. Revenues missed expectations, reaching $1.51 billion in the quarter instead of the $1.55 billion in the Zacks consensus. Next-quarter earnings guidance remains in range with the previous estimate. The highlight this quarter was +14% Direct-to-Consumer growth year over year. But shares are -3% in late trading.
Tomorrow’s big Employment Situation report hits the tape ahead of the open, with 170K jobs expected to have been filled last month, and an Unemployment Rate ticking down 10 bps to 3.7%. These figures would be commensurate with a still-healthy labor market, creating more jobs than it would need to account for retiring Baby Boomers, while keeping at low levels of overall unemployment, even as Labor Force Participation (hopefully) keeps increasing.
But if Wednesday’s ADP number of 89K private-sector jobs for September is any indication, we may expect a lower number on tomorrow’s headline from the U.S. government. It may be worth noting whether striking workers in Detroit and, as of last month at least, Los Angeles will be apparent in this data; ADP records do not include striking workers as long as they remain listed as employees of a private company. In any case, it’s the biggest economic news event of the week, and we hold out hope it may have a positive effect on Friday’s trading. Questions or comments about this article and/or author? Click here>>
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Markets Just Miss Closing in the Green
It was a galant effort in today’s trading session to have the major indices close in the green today, but it was all for naught. Well except the small-cap Russell 2000, which finished up +0.23% — but it’s still down -4% over the past five trading days. The Dow was just a smidge under, -0.03%, while the Nasdaq and S&P 500 were in tandem all day, -0.12% and -0.13%, respectively.
We don’t know much through the course of this trading session we didn’t already know when the opening bell rang: Jobless Claims, both new and longer-term, both came below projections yet again, which are already historically low. And September Job Cuts from the Challenger survey were drastically reduced month over month. Normally, these would be cause for celebration in the markets, but not when investors are counting on souring data to help the Fed decide not to raise keep interest rates so high.
The 10-year bond yield continues to hang around 16-year highs at 4.712% — off the 4.8% we saw yesterday, but marginally. The 2-year is at 5.15%, so the inversion is still in place — and not notably narrowing as it had been earlier today: this morning we were seeing a spread of around 25 basis points (bps), now it’s back up over 40. More directly, these high yields are offering a real return sans risks associated with the equities markets. So while investors protect their windfall gains from companies like NVIDIA (NVDA - Free Report) earlier this summer, it’s clearly helping take a bit out the stock market.
Levi Strauss & Co. (LEVI - Free Report) kept its perfect earnings surprise streak alive since its IPO in 2019, though the American icon apparel retailer beat estimates by only a penny to 28 cents per share — well off the 40 cents posted in the year-ago quarter. Revenues missed expectations, reaching $1.51 billion in the quarter instead of the $1.55 billion in the Zacks consensus. Next-quarter earnings guidance remains in range with the previous estimate. The highlight this quarter was +14% Direct-to-Consumer growth year over year. But shares are -3% in late trading.
Tomorrow’s big Employment Situation report hits the tape ahead of the open, with 170K jobs expected to have been filled last month, and an Unemployment Rate ticking down 10 bps to 3.7%. These figures would be commensurate with a still-healthy labor market, creating more jobs than it would need to account for retiring Baby Boomers, while keeping at low levels of overall unemployment, even as Labor Force Participation (hopefully) keeps increasing.
But if Wednesday’s ADP number of 89K private-sector jobs for September is any indication, we may expect a lower number on tomorrow’s headline from the U.S. government. It may be worth noting whether striking workers in Detroit and, as of last month at least, Los Angeles will be apparent in this data; ADP records do not include striking workers as long as they remain listed as employees of a private company. In any case, it’s the biggest economic news event of the week, and we hold out hope it may have a positive effect on Friday’s trading.
Questions or comments about this article and/or author? Click here>>