After five straight down days, the market returned to its normally scheduled melt up. Futures were up strongly very early going and the 8:30 AM government release on jobs data pushed them up even higher as a better than expected job number AND lower unemployment rate did not create a "oh no, good news means the Fed is going to take away our goodies immediately" reaction. Probably a good part of this is the market was short term oversold as we showed yesterday. Today's rally almost created a 9th straight up week but some selling in the closing hour created a narrow miss. For the day the S&P 500 gained 1.12% and the NASDAQ 0.73%. The S&P 500 has now been up 7 "Jobs Fridays" in a row.
Job creation moved forward again in November, with the U.S. economy adding a better-than-expected 203,000 to the employment rolls; the unemployment rate fell to 7 percent. Economists were expecting the Bureau of Labor Statistics to report 180,000 new jobs created in November, down from an initially reported 204,000 in October. The unemployment rate was expected to decline a notch to 7.2 percent from 7.3 percent. The biggest employment gains came in professional and business services (35,000), transportation and warehousing (31,000) and health care, which added 28,000. Manufacturing contributed 27,000 new positions and retail was up 20,000. Earnings notched higher by 4 percent to an average $24.15 an hour while the work week rose one-tenth to 34.5 hours.
We'll keep an eye on the NASDAQ a bit closer than the S&P 500 for this moment, simply because it is in a more simple pattern.
Treasury yields initially spiked on the good economic news but came in some later in the day. It is not so easy as saying better economic data = taper, because Janet Yellen is coming in 2014 and she is even more dovish than Ben Bernanke on monetary policy.
JCPenney (JCP) was mentioned yesterday; it fell another 8% today as the company disclosed that the Securities and Exchange Commission has an inquiry about its finances.
Retail continues to be a trouble spot as Ulta Salon (ULTA) the cosmetics superstore, tanked 20% after the company posted weaker than expected results and lowed its fourth quarter outlook.
Big Lots (BIG) was another as earnings came in below analyst expectations.
On the positive side might as well highlight the biotechs as they have been the stars of 2013. Here is Celgene (CELG) and Biogen (BIIB)
Have a good weekend and we'll see you back here Monday.