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Pre-market futures are up big this morning. Major indexes started off early trading in the green, buoyed by another massive earnings report from NVIDIA ((NVDA - Free Report) yesterday afternoon. But the return of non-farm payroll data this morning — September jobs numbers, which are in arrears, but we’ll take it — are sending markets into another orbit. The Dow is +350 points at this hour, the S&P 500 is +95, the Nasdaq +470 points and the small-cap Russell 2000 +30.
September Non-farm Payrolls Up to +119K
A welcome sight it is! Non-farm payrolls from the U.S. Bureau of Labor Statistics (BLS) are not only finally released after a 6+ week government shutdown, but have come in stronger than where they were when we last saw them. Headline jobs gains for September (this is a delayed report) came in at +119K, much better than the downwardly revised -4K reported for August. The Unemployment Rate, meanwhile, ticked up 10 basis points (bps) to +4.4%.
It’s only the third positive BLS jobs month since May, but the good news is we’re making higher highs each time we post positive employment headlines. Today’s +119K — which, hopefully, also means it’s a more accurate figure with revisions perhaps having been folded in already — is the best month of new jobs since April’s +158K. Compare this with the four-month trailing average of a mere +19K new jobs filled. Definitely moving in the right direction.
The higher Unemployment Rate likely has something to do with a Labor Force Participation Rate ticking up to +62.4%. This is still not a great level, even though it’s the best we’ve seen since April’s +62.6%, but again: it’s moving the right way. Same with the U-6 line (aka “real unemployment”), which ticked down 10 bps to +8.0%.
The private sector made up +97K of those new jobs in September, as per normal. Top sectors include Healthcare at +57K and Leisure & Hospitality +47K. Construction had a good month, up +19K. Manufacturing was down -6K. The Average Workweek ticked up to 34.2 hours — again, not amazing but showing improvement. Wages were mixed: down 10 bps to +0.2% month over month but up 10 bps to +3.8% year over year.
How does this data affect the pending interest rate cut for the Fed next month? Meh. Again, this is relatively old data; October and November BLS numbers had always informed Fed rate policy, but they likely won’t be around by the December 10th Fed decision. Currently, analysts see only a +30% change of another 25 bps cut, but that goes up to +72% for January.
Weekly Jobless Claims Pick Up Where We Left Off
Also hitting the tape this morning are Weekly Jobless Claims, making it finally feel like Thursday morning again. Initial Claims dropped to +220K, -7K from the consensus and the lowest weekly level since mid-July. We had seen these new claims numbers jumping around from week to week; today’s figure is right in the sweet spot, and investors can put off fretting about the near-term job market.
Continuing Claims did tick up to 1.974 million, which is back toward the top level we’ve seen over the past few months: for 13 weeks we remained in a range of 1.94-1.97 million longer-term jobless claims — an amazing amount of time to get that high that fast but never strike the psychologically important 2 million continuing claims. However, now that we’re pushing up on that envelope again, it will be something worth watching going forward.
Walmart Beats by a Penny, Shares Rise
The biggest of the big-box retailers, Walmart ((WMT - Free Report) , has posted Q3 earnings this morning which outperformed expectations. Earnings of 62 cents outpaced the Zacks consensus by a solid penny, while revenues of $179.5 billion surged +1.33% past estimates for the quarter. Walmart has bounced back from its earnings miss last quarter; revenues had come in ahead of expectations in each of the last four quarters. Comps were up +4.5%, and the company raised guidance for Q4.
It’s ultimately a lukewarm report, but like the jobs data this morning, it’s good enough to feed positive market sentiment. That we’ve staved off any sort of economic downturn anywhere in this morning’s data is speaking volumes — especially coming after a week of portfolio trimming. Investors are putting their money back into the market, secure that the sky is not falling, the labor force has not unravelled and consumers are still shopping.
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Jobless Claims Decreased More Than Expected
Pre-market futures are up big this morning. Major indexes started off early trading in the green, buoyed by another massive earnings report from NVIDIA ((NVDA - Free Report) yesterday afternoon. But the return of non-farm payroll data this morning — September jobs numbers, which are in arrears, but we’ll take it — are sending markets into another orbit. The Dow is +350 points at this hour, the S&P 500 is +95, the Nasdaq +470 points and the small-cap Russell 2000 +30.
September Non-farm Payrolls Up to +119K
A welcome sight it is! Non-farm payrolls from the U.S. Bureau of Labor Statistics (BLS) are not only finally released after a 6+ week government shutdown, but have come in stronger than where they were when we last saw them. Headline jobs gains for September (this is a delayed report) came in at +119K, much better than the downwardly revised -4K reported for August. The Unemployment Rate, meanwhile, ticked up 10 basis points (bps) to +4.4%.
It’s only the third positive BLS jobs month since May, but the good news is we’re making higher highs each time we post positive employment headlines. Today’s +119K — which, hopefully, also means it’s a more accurate figure with revisions perhaps having been folded in already — is the best month of new jobs since April’s +158K. Compare this with the four-month trailing average of a mere +19K new jobs filled. Definitely moving in the right direction.
The higher Unemployment Rate likely has something to do with a Labor Force Participation Rate ticking up to +62.4%. This is still not a great level, even though it’s the best we’ve seen since April’s +62.6%, but again: it’s moving the right way. Same with the U-6 line (aka “real unemployment”), which ticked down 10 bps to +8.0%.
The private sector made up +97K of those new jobs in September, as per normal. Top sectors include Healthcare at +57K and Leisure & Hospitality +47K. Construction had a good month, up +19K. Manufacturing was down -6K. The Average Workweek ticked up to 34.2 hours — again, not amazing but showing improvement. Wages were mixed: down 10 bps to +0.2% month over month but up 10 bps to +3.8% year over year.
How does this data affect the pending interest rate cut for the Fed next month? Meh. Again, this is relatively old data; October and November BLS numbers had always informed Fed rate policy, but they likely won’t be around by the December 10th Fed decision. Currently, analysts see only a +30% change of another 25 bps cut, but that goes up to +72% for January.
Weekly Jobless Claims Pick Up Where We Left Off
Also hitting the tape this morning are Weekly Jobless Claims, making it finally feel like Thursday morning again. Initial Claims dropped to +220K, -7K from the consensus and the lowest weekly level since mid-July. We had seen these new claims numbers jumping around from week to week; today’s figure is right in the sweet spot, and investors can put off fretting about the near-term job market.
Continuing Claims did tick up to 1.974 million, which is back toward the top level we’ve seen over the past few months: for 13 weeks we remained in a range of 1.94-1.97 million longer-term jobless claims — an amazing amount of time to get that high that fast but never strike the psychologically important 2 million continuing claims. However, now that we’re pushing up on that envelope again, it will be something worth watching going forward.
Walmart Beats by a Penny, Shares Rise
The biggest of the big-box retailers, Walmart ((WMT - Free Report) , has posted Q3 earnings this morning which outperformed expectations. Earnings of 62 cents outpaced the Zacks consensus by a solid penny, while revenues of $179.5 billion surged +1.33% past estimates for the quarter. Walmart has bounced back from its earnings miss last quarter; revenues had come in ahead of expectations in each of the last four quarters. Comps were up +4.5%, and the company raised guidance for Q4.
It’s ultimately a lukewarm report, but like the jobs data this morning, it’s good enough to feed positive market sentiment. That we’ve staved off any sort of economic downturn anywhere in this morning’s data is speaking volumes — especially coming after a week of portfolio trimming. Investors are putting their money back into the market, secure that the sky is not falling, the labor force has not unravelled and consumers are still shopping.