Crystal drop

Weekly jobless claims drop dramatically

Pre-market futures remain in the green, after the best stretch among stock indexes we’ve seen in two months. Fresh off new closing highs across the board, we are currently seeing the Dow +4 points, the S&P 500 +6 points and the Nasdaq +50. If it seems that the rally of the Dow Jones and the S&P is lengthening a bit, it may be true; the S&P has only posted two days of decline since October 12. Although the tech-rich Nasdaq always seems ready for action.

The new weekly jobless claims are helping to maintain the mood: Initial jobless claims have now hit a new post-Covid low of 269K – down for the fifth week in a row and closer to the 225K per week we saw before the pandemic. This follows the slightly upward revised 283K, which itself was a post-Covid low. This is the right direction to take, although part of this drop in new demand is linked to seasonal rentals for vacations, which are expected to collapse in early 2022.

Continuing complaints also hit a post-Covid low of 2.105 million two weeks ago (long-term claims point to a week in arrears due to new claims), going from a slight downward revision the week before to 2.239 million. As with the initial claims looking to hit the 200-225,000 mark in 2019, continuing claims therefore envision less than $ 2 million to get back to these historically healthy claims numbers.

It also provides a good account of the deadlock we’ve seen in the labor market as a whole over the past six months or so – that employees are not drawn into their old jobs at the same rates and pay conditions. These new post-Covid lows on new and longer-term demands suggest that some traction has been done here. See also yesterday’s ADP ADP reports the private sector payroll and looks to the US government’s future non-farm payrolls, where 450,000 new jobs are expected to have been created last month, more than double the 194,000 we saw in September.

T3 productivity fell quite precipitously this morning, -5.0% against + 2.1% recorded the previous quarter. These are seasonally adjusted and annualized non-farm productivity units, where a reading of -3.2% was expected. For comparison, in the second quarter of 2020 we saw a huge jump in productivity to + 11.2%.

Unit labor costs for Q3 can provide a large part of the explanation here: + 8.3%, up from the + 7.4% expected and a sharp increase from the + 1.1% revised downward from Q2. We can therefore see that this wage growth is largely a Q3 phenomenon; although this weighs on productivity in the short term, the improvement in wages for the entire workforce is positive according to the Fed, which finally announced yesterday the start of the reduction in asset purchases.

The international trade deficit for September hit an all-time high of – $ 80.9 billion, a significant drop from the revised upward – $ 72.9 billion posted for August. While we are historically at a low point (and until the mid-1970s this reading was still at or near zero), it’s still a little better than the expected -81.0 billion dollars. Imports hit a record high while exports lagged behind. It can also be related to the upcoming holiday season.

Moderna Shares of MRNA fell -14.4% in today’s pre-market, on big hiccups in its third quarter earnings report. Earnings of $ 7.70 per share on $ 4.97 billion in sales were nowhere near the expected $ 8.96 per share and $ 6.05 billion mark, respectively. These represent negative surprises of -14% and -17.8%, respectively.

While no one doubts the strength of the company’s Covid vaccine, Moderna is now engaged in pharmaceutical production and distribution on a scale far beyond its past history. In addition, the company’s stock had risen + 231% since the start of the year; this big failure in the third quarter could cause stocks to fall back after the nosebleeds.

Zacks’ top picks for leveraging artificial intelligence

By 2021, this world-changing technology is expected to generate $ 327.5 billion in revenue. Now Shark Tank star and billionaire investor Mark Cuban has said AI will create “the world’s first trillionaires.” Zacks’ Urgent Special Report Reveals 3 AI Choices Investors Need To Know Today.

See 3 artificial intelligence stocks with extreme upside potential >>

Click to get this free report

Automatic Data Processing, Inc. (ADP): Free Stock Analysis Report

Moderna, Inc. (MRNA): Free Stock Analysis Report

To read this article on Zacks.com, click here.

Zacks investment research

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


Source link

Leave a Reply

Your email address will not be published. Required fields are marked *