November continues its equity market mudslide this morning, as trepidation grips the market ahead of two important releases later this week: NVIDIA’s (NVDA) earnings report after the bell tomorrow and the Employment Situation report for September (still lagging, but better than nothing). Until one or both of these brings a sigh of relief to market participants, we’ll likely see a “risk-off” trading environment.
The Dow is currently -349 points, -0.75%, while the S&P 500 is -30 points, -0.46%. The tech-heavy Nasdaq leads the arrow downward, -137 points or -0.59%, and the small-cap Russell 2000 is -10 points, -0.43%. Over the past five trading days, these indexes are taking a bath, between -3.2% on the S&P to -5.2% for the Russell.
ADP Weekly Jobs Report Still Negative
With the elongated government shutdown keeping economists and data-driven investors in the dark, private-sector payroll provider ADP (ADP) began a weekly preliminary jobs report a few weeks back. That’s the good news. The not-so-good-news is that we’re now down for the second of three weeks this chart has been in operation: -2500 private-sector jobs were lost last week — an improvement from -11K the prior week but still pointing to a weak employment picture on the private-sector side.
This is, as we know, something of a blessing for those looking for the Fed to continue cutting interest rates. We should find out more when the September jobs numbers are released in a couple days, and if that survey is somewhat in line with the ADP data (no guarantee they will be, however; usually it’s only after a monthly revision or two that these figures align themselves) then we may see a boost to market sentiment with the understanding that the December 25 basis-point (bps) cut is back on the table.
What We’re Missing from Today
We had written on the calendar for this week releases for the October Imports & Exports report and Industrial Production & Capacity Utilization, also for October. We are likely to get a delayed Factory Orders report after today’s open, and the privately-held Homebuilders Confidence Index for November is also expected at 10am ET this morning. Expectations there are for an even — but still clearly soft — 37, the same as October.
Home Depot Misses Q3 Earnings, Lowers Guidance
This morning’s Home Depot (HD) earnings miss is the third-straight for the home improvement retail giant, with $3.74 per share coming in -1.84% from the $3.81 in the Zacks consensus. Revenues outperformed expectations by a smidge, +0.88% to $41.35 billion in the quarter. This amounts to Home Depot’s third top-line beat in its last four quarters.
However, its downward guidance for Q4 and the full fiscal year are sending shares down -5% in today’s pre-market trading. The stock was already down -8% year to date, -12% since this time this past year. The company has been hit by the double whammy of a weak housing cycle (now years old) and an immigration crackdown from ICE agents in various metropolises across the U.S.
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