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Non-Farm Job Addition Remains Strong In July

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New non-farm payroll numbers from the U.S. Bureau of Labor Statistics (BLS) were released this morning, and came in almost exactly in-line with estimates: 164K new jobs created for the month of July. The Unemployment Rate stayed constant at a low 3.7%.

Revisions to the past two months were lower, from 72K to 62K for May and from 224K originally reported last month to 193K for June this morning. This has resulted in 41K fewer jobs than originally reported, and the 3-month average now sits at 140K new jobs created per month. This is roughly 100K fewer than we saw 6 months ago.

Professional/Business Services led the way with 31K, the biggest component of the 133K Services total for July. Manufacturing came in at 16K new jobs, and now average just 8000 per month — well down from the 2018 average of 22K Manufacturing jobs per month. Retail hires were down for the 6th month in a row. Government hiring was up, totaling 30K in the past 2 months, while Temp workers (an indicator of future permanent hires) was down.

Average Hourly Earnings increased by 8 cents to an average of $27.98, which is up 0.3% month over month and +3.2% year over year. These are decent numbers, and really the least one could expect from such a long-term solid labor market. Then again, we saw better figures in the beginning of the year, leading analysts to consider whether productivity issues may arise as a concern.

Labor Force Participation ticked up to an even 63.0, while the U-6 (aka “real unemployment”) notched down 20 basis points to 7.0. Again, solid numbers reflecting a still-strong jobs picture.

June’s Trade Deficit improved very slightly to -$55.2 billion from -$55.5 billion in the last read, though analysts were looking for -$54.6 billion. Now with a new set of tariffs against China announced by Trump scheduled for September 1st, we will take a closer look at these numbers in the months ahead.

Q2 Earnings Roundup

ExxonMobil (XOM - Free Report) , the world’s largest commodities-based company and a Zacks Rank #5 (Strong Sell) ahead of its Q2 earnings report, outperformed estimates on both top and bottom lines this morning. Earnings of 73 cents per share was ahead of the 68 cents expected, though down considerably from the 92 cents per share in the year-ago quarter. Exxon shares have only gained 6.3% year to date, and are up modestly in today’s pre-market.

Exxon competitor Chevron (CVX - Free Report)  posted a mixed earnings report early Friday, with $2.27 per share easily outpacing the $1.74 expected, with $38.85 billion in revenues missing the Zacks consensus by 6.8% and down from the $42.24 billion a year ago. Shares are up modestly upon the Q2 release, are are up 11% year to date.

Sprint (S - Free Report) , still expected to merge with T-Mobile (TMUS - Free Report) , met expectations of -3 cents per share on $8.14 billion in sales which outperformed estimates by 1.47%. Expectations of the merger have sent shares up more than 23% — ahead of the S&P 500 — and are down -0.42% in today’s pre-market.

Semiconductor major Seagate Technologies (STX - Free Report)  beat estimates on both top and bottom lines, by 3 cents on earnings to 86 cents per share, with $2.37 billion in revenues beating expectations by 2.5% (though down from $2.84 billion reported in the year-ago quarter). The company has gained 20% year to date, but is falling more than 6% following the earnings report in early trading.

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