Jobless Claims & Q4 Earnings

We're again somewhat light on economic data this morning, with new Housing Starts and Building Permits for December going unreported due to the partial U.S. government shutdown, which tomorrow will reach four full weeks, and already an all-time record. Thankfully, Q4 earnings season and normal Thursday Initial Jobless Claims will help inform the markets, which are starting out pre-market trading in the red.

Initial Jobless Claims fell last week by 3000 claims to 213K, from an unrevised 216K the previous week. This is also 20K claims lower than we saw in this read two weeks ago, when claims leaped out of the long-term 200-225K range. The U.S. labor market remains historically robust, with no headwinds showing up in the data - and when they do, they tend to correct back to the mean.

Continuing Claims went to 1.737 million last week, up from the originally reported 1.722 million from a week ago. These figures have buoyed up slightly from levels down under 1.7 million for a while there, but are nevertheless consistent with a very healthy domestic work force.

January Philly Fed numbers also surprised to the positive this morning, posting a 17.0 headline - more than double the 8.0 reported last month, and well above the 9.5 expected by analysts. This is economic data in relative microcosm: commerce from a top ten U.S. city via its federal agency, which can fluctuate notably month to month. As such, this is a pleasing figure that will hopefully continue as 2019 rolls along.

Q4 Earnings Misses and Mixed

The most noteworthy firm to have reported earnings results this morning is investment giant Morgan Stanley MS , which underperformed fairly badly in its Q4 report compared to expectations. Earnings of 73 cents per share was not only far beneath the 90 cents in the Zacks consensus, but also pales in comparison -13% year over year. Revenues of $8.54 billion was well under the estimated $9.44 billion, down 10% from a year ago.

CEO James Gorman offered some words of encouragement, however, when he said, "Q4 is not the 'new normal." Gorman pointed out that calendar 2018 was a "great year that finished on a disappointing note." The takeaway here is that the massive sell-off we saw in the end of last year had hit Morgan Stanley worse than expected. Shares are down nearly 4% in pre-market activity, and -9% over the past three months.

Fellow Wall Street banker BB&T BBT beat bottom line estimates by a penny to $1.05 cents per share. Revenues, however, missed slightly - $2.94 billion versus $2.95 billion in the Zacks consensus.

Commerce Bancshares CBSH also topped expectations by a penny to 96 cents per share, and up strongly from the 70 cents reported in the year-ago quarter. Revenues of $345.3 million outperformed the Zacks consensus by 2.9%.

Manufacturing sector indicator FastenalFAST - a company that makes fasteners for scores of different hard goods - was in-line with its Q4 estimates: 60 cents per share exactly met expectations, while its $1.23 billion in quarterly sales beat the Zacks consensus by 1%.

Chemicals and high-performance paint manufacturer PPG PPG topped earnings estimates - $1.15 per share versus $1.09 expected - on $3.65 billion, which represented a slight miss on the top line. These figures are also down a tad from a year ago.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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