Stocks are about flat this morning after cutting losses as job
growth lagged estimates.
S&P 500 futures are slightly positive, rebounding from a
decline of more than 0.3 percent earlier. Europe is fractionally
lower, and Asian markets were mixed overnight.
The Labor Department reported that 142,000 jobs were added last
month, well below the 223,000 forecast by economists. The miss
reduced fears that interest rates will increase in the near term.
Unemployment fell to 6.1 percent as expected. The S&P 500
has been churning around record highs for more than a week
following a quick rally in August, so the bigger question may be
whether a pullback is needed before expecting a breakout.
Developments across the Atlantic are also gaining importance after
unprecedented stimulus measures by the European Central Bank
yesterday drove the euro to its lowest level against the U.S.
dollar in more than a year. Its rapid descent could make investors
fear a negative impact on corporate earnings given that many
companies have significant operations in Europe.
The calendar slows following today's job report. Next week's big
events are Apple's expected launch of the iPhone 6 on Tuesday and
retail sales on Friday.
Sentiment has been mixed recently, with some economically sensitive
sectors such as transportation and retail outperforming. Oil and
gas companies, however, have lost their leadership and are now the
worst-performing group in the last month. Our
market scanner also shows investors moving into new areas including
solar energy, Latin American banks and widening their interest in
semiconductor names. Financials have started to gain positive
momentum as well.
In company-specific news, semiconductor company Ambarella is
indicated up 7 percent after releasing better-than-expected
earnings and revenue. El Pollo Loco also gained 4 percent on a
strong quarterly report. Finisar declined 6 percent on weak sales
and guidance. Apple is also up almost 1 percent after pulling back
in the last two sessions.
The euro and oil, which have both fallen together in recent months,
are fractionally higher this morning. Copper is also eking out a
small gain and precious metals are down slightly.
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