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Stock Market News for Nov 4, 2019

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Benchmarks closed in the positive territory on Nov 1 as investors derived optimism from strong job additions in October, without allowing U.S. manufacturing sector’s contraction last month dampen their spirits.

The three major indexes— the Dow, S&P 500 and Nasdaq Composite — finished in the green on Friday. Dow hit 27,347.36 after gaining 1.1%, the S&P 500 finished at 3,066.91 after adding 1% and the tech-laden Nasdaq Composite closed at 8,386.40 after increasing 1.1%.

The fear-gauge CBOE Volatility Index (VIX) declined 7% to close at 12.30 on Nov 1. Finally, advancers outnumbered decliners on the NYSE by a 2.81-to-1 ratio.

Remarkable New Job Additions in October

According to the U.S. Bureau of Labor Statistics, total nonfarm payrolls for October increased by 128,000. The unemployment rate edged higher at 3.6%, although it still remained around the lowest in half a century.

Job additions were broad-based, with a significant number of new jobs added in food services and drinking places, professional and business services, social assistance and financial activities. To be specific about the number of jobs added in each sector last month, food services and drinking places added 48,000 jobs and social assistance added 20,000. Professional and business services added an impressive 22,000 new positions in October while financial activities and healthcare added 16,000 and 15,000 new jobs respectively.

Apart from these notable sectors, employment in real estate also increased by 10,000.

Manufacturing Sector Lost Steam

Unlike other sectors of the U.S. economy, the manufacturing sector contracted in October, marking losses for a third straight month. After all, uncertainty over the much-anticipated U.S.-China trade deal and fears over global economic slowdown continued to take a toll on factories.

The manufacturing Purchasing Managers Index from the Institute for Supply Management was reported at 48.3% in October. Although it was slightly higher than September’s 47.8%, a figure below 50% represents a contraction.

The sector’s slowdown was reflected in October’s job report, wherein employment in the sector declined by 36,000.

Big Energy Players Reported Impressive Earnings

Shares of Chevron Corporation (CVX - Free Report) added 0.1% on Nov 1 after the energy company reported adjusted third-quarter 2019 earnings per share of $1.59, higher than the Zacks Consensus Estimate of $1.47. A major factor behind Chevron’s upbeat earnings was strong oil-equivalent production, which rose almost 3% from the same period last year. Chevron carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. (Read more)

Shares of Exxon Mobil Corporation XOM gained 3% on Friday after the crude oil and natural gas producer’s Q3 2019 earnings were better-than-expected, thanks to the increased production of liquid volumes in the Permian Basin. The company reported earnings per share of 68 cents, which beat the Zacks Consensus Estimate of 64 cents. (Read more)

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