Stocks shook off a weak NFP report today to make their way into
At8:30 a.m. EST , the Bureau of Labor Statistics announced that
just 74,000 jobs were created in December 2013, the lowest number
seen since January 2011. The December print was a far cry from not
only the 197,000 consensus, but from the low forecast of 100,000.
Private payrolls also missed by a big margin, coming in at just
87,000 vs. Wall Street's expectations for a 200,000 gain.
The unemployment rate was well below expectations at 6.7%, but that
was the result of a significant shrinking of the labor force.
Economists were generally perplexed by the weakness, especially
since Wednesday's ADP employment report was so strong. Unexpectedly
cold weather likely played a role in slowing down hiring, and some
jobs sectors -- like health care and accounting and bookkeeping
services -- were surprisingly weak.
On the positive side, November 2013's NFP number was revised up
to 241,000 from 203,000.
Immediately following the report,
(INDEXSP:.INX) stock futures dropped 12 points. However, the index
bottomed out by midday, and gradually crawled up throughout the day
to finish up 0.2% at 1842.37.
But the real action was in Treasuries, as yields steadily
declined throughout the day, bringing the 10-year down 10 bps to
2.86%, a level not seen since mid-December. That sharp drop drove a
spike in interest-rate sensitive stock sectors like utilities and
housing. Gold also performed well, with a 1.3% gain.
Elsewhere, shares of
) rose an incredible 62% to $445.83 , just one day after it rose
281% on news of a successful trial for a liver-disease drug.
Bank of America
) helped drive the optimism as it increased its price target on
Intercept to $872 from just $81.
) sold off 5.4% to $10.11 after the aluminum maker reported
weaker-than-expected fourth-quarter earnings. The stock had risen
20% in the two months preceding the report, so expectations were
The retail sector was busy, with
) taking a 13.8% hit following its disappointing sales update
issued after the closeThursday , while
Abercrombie & Fitch
) shot up 12.0% on its increased guidance.
(TGT) fell 1.1% after lowering fourth-quarter guidance and
announcing that its recent security breach was larger than
And finally, Indian IT firm
(INFY) squeezed out a 6.0% rally on its better-than-expected
third-quarter earnings report.
Monday's Financial Outlook
There are no major earnings and economic reports on the calendar
forMonday . For now, investors will be parsing the NFP numbers as
well as pondering the impact of the recent QE taper announcement.
Additionally, some investors may be feeling cautious from the weak
start to the year, which can be a harbinger of dark times ahead.
In terms of news, we should see more companies adjusting
fourth-quarter guidance, and based on recent history, the changes
will likely be mostly negative.
And of course, things will pickon Tuesday with the December 2013
retail sales numbers, and earnings reports from megabanks