Stocks Rally on New Jobs Data; Oil Adds Back Some of Prior-Session Loss

Stocks are holding gains, but off session highs, on a jobs-fueled rally after spending most of the week in the red. New government data released this morning before the opening bell showed a better-than-expected gain in private employment. Oil and gold futures managed to pare some prior-session losses and are positive.

The U.S. economy gained 244,000 jobs in April, the biggest increase in almost a year, according to the Labor Department, and more than the 175,000 gain expected by economists. Private employers created 268,000 jobs last month, the most since February 2006, according to the report.

Still, the nation's unemployment rate rose to 9.0%. Most economists looked for the rate to hold at March's 8.8%. It was the first increase since last November. Average hourly earnings rose 0.1% to $22.95. The average workweek remained unchanged.

In company news:

Citigroup ( C ) shares are getting a boost after Morgan Stanley ( MS ) upgraded the company to "overweight" from "equal weight" and put a $6 price target on the firm. The upgrade was due to the pace at which the bank is divesting non-core assets, the growth of its international business and the increase in capital returns to shareholders, noted on the move.

Pfizer ( PFE ) shares are higher after Reuters reported that the drug maker has returned rights to an inhaled asthma therapy to Rigel Pharmaceuticals ( RIGL ). The move comes as Pfizer is looking to exit research and development in the allergy and respiratory therapeutic market, the report said. Pfizer had originally licensed the treatment in 2005.

Google ( GOOG ) shares are up even as Bloomberg reports that the Internet search giant lost a court fight to overturn a ruling in a Belgian court that would block it from publishing links to local newspapers on its online news service. The 2007 ruling forced Google to remove links to articles for French- and German-language Belgian newspapers.

Warner Music Group (WMG) trading was suspended before the bell following reports that the financially troubled recording company is being bought by Access Industries, a company owned by Russian Investor Len Blavatnik, for $1.3 billion, or $8.25 a share, the AP reported. Access is also assuming about $2 billion of Warner Music Group's debt. The person was not authorized to talk about the deal and spoke on condition of anonymity. The person says a formal announcement is planned Friday, the AP reported.

Shares resumed trading around mid-morning and are currently at $8.09, up $0.19, or 2.41%.

In earnings news:

--Alcatel-Lucent (ALU) starts lower after it posted a net loss of 10 million euros ($14.6 million) in Q1 compared to a loss of 515 million euro recorded in the year-earlier quarter. Adjusted operating profit came in at 13 million euro compared to a loss of 195 million euro a year earlier, beating consensus expectations of a 68 million euro loss, according to a poll of six analysts by Dow Jones Newswires.

--Weight Watchers (WTW) reports Q1 revenue of $503.4 mln, better than the analyst consensus of $480 mln on Thomson Reuters. EPS was $1.00, vs. expectations of $0.89 per share. For the full year 2011, the company is raising its EPS view to a range of $3.75 to $4.00 per share, up from its previous guidance of $3.50 to $3.85 per share. The Street is at $3.71 per share.

--Cowen (COWN) says Q1 sales were $64.2 million, below the Thomson Reuters mean for $78.33 million. GAAP EPS were breakeven. The Thomson Reuters mean, usually less items, was for a nickel in profits.

--Kraft Foods (KFT) reports Q1 adjusted EPS of $0.52 compared to $0.49 a year earlier and topping the Street view for $0.46. Revenue was $12.6 billion, up 11%. For 2011, adjusted earnings are expected to be $2.20 a share. Analysts are looking for $2.23 a share.

--Tesco Corporation (TESO) is lower after it said late Thursday Q1 net income was $0.13 per share, below the Thomson Reuters mean for $0.16. Sales were $105.6 million, below forecasts for $120 million.

Commodities are higher. June gold contracts are up 0.91%, to $1,495 an ounce while June crude oil contacts are up 2.17% to $101.95 a barrel.

In energy ETFs, the United States Oil Fund (USO) is up 2.47% to $40.29 and the United States Natural Gas fund (UNG) is up 1.18%, to $11.12.

In precious metal ETFs, the SPDR Gold Trust (GLD) is up 1.54% at $145.68. Market Vectors Gold Miners (GDX) is up 1.87% to $57.16. iShares Silver Trust (SLV) is up 4.92% to $35.39.

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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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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