Thursday, March 8, 2012
This morning's favorable news flow should help stocks sustain
the positive momentum from Wednesday. Greece's private sector bond
swap, whose uncertain fate had gripped the markets in recent days,
appears to be attracting enough participation to make the deal
binding on all bondholders. The details of the swap will come out
Friday morning, but growing optimism about the deal is helping
bring down the yields on Italian and Spanish government bonds,
which had started creeping back up in recent days.
Friday morning not only clears up the air on the Greek
situation, but will also likely confirm the recent improving trend
in the U.S. labor market though the February non-farm payroll
report. This morning's modestly weaker than expected initial
Jobless Claims report nevertheless confirms the improving jobs
picture, helping build expectations of a strong labor reading
tomorrow. The expectation is that a favorable labor market read on
Friday will serve as the key catalyst to push stocks above
resistance levels.
Initial Jobless Claims came in a tad weaker than expected last
week - up 8K to 362K vs. expectations of a lower rise. The prior
week's tally was modestly revised upwards to 354K from the
originally reported 353K. The four-week average, which smoothes out
the week-to-week fluctuation, moved up by a mere 250 to 355K. This
week's modest 'miss' notwithstanding, the overall trend in the
labor market has consistently been in favorable direction lately.
It will be interesting to see if Friday's jobs report will further
confirm this trend.
On the earnings front,
Williams-Sonoma
(
WSM
), the home furnishings retailer, beat earnings and revenue
expectations and guided higher. Results at truck maker
Navistar
(
NAV
) and retailer
Stein Mart
(
SMRT
) came short of expectations.
Sheraz Mian
Director of Research
NAVISTAR INTL (
NAV
): Free Stock Analysis Report
STEIN MART INC (
SMRT
): Free Stock Analysis Report
WILLIAMS-SONOMA (
WSM
): Free Stock Analysis Report
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