News Column

Wall Street Guarded Ahead Of Non-farm Payrolls Data

September 5, 2014

WASHINGTON (Alliance News) - The mood on Wall Street remains cautious, with the major index futures pointing to a modestly lower opening on Friday. After fairly strong domestic data upset the rhythm of the markets yesterday, traders brace for another first-tier data that could shed light on the strength of the labor market recovery. Economists expect August to be another month, which saw a brisk pace of job additions. Among the global markets, Asian stocks went about in a lackluster manner, while the European markets are also seeing weakness despite a strong German industrial output reading, as traders look ahead to the US jobs report and the communiquÉ from the 2-day NATO meeting that ends today.

At 6:15 am ET, the Dow futures are slipping 64 points, the S&P 500 futures are down 8.50 points and the Nasdaq 100 futures are receding 12.50 points.

US stocks declined on Thursday in a late hour sell-off, as early optimism built on the back of a benevolent move by the European Central Bank and fairly in line domestic economic data gave way to fears over monetary policy normalization in the US

On the economic front, the Labor Department is scheduled to release its monthly non-farm payrolls report for August at 8:30 am ET. Economists expect the economy to have added 230,000 jobs in August, while the unemployment rate is expected to edge down to 6.1%.

Philadelphia Federal Reserve Bank President Charles Plosser is due to speak on the economic outlook in Amelia Island, Florida at 10:15 am ET. Additionally, Boston Federal Reserve Bank President Eric Rosengren will speak to New Hampshire and Vermont Bankers Association in Boston at 3:45 pm ET.

In corporate news, NVIDIA (NVDA) announced that it has filed complaints against Samsung and Qualcomm (QCOM) at the ITC and the US District Court in Delaware, alleging that Samsung and Qualcomm have infringed its GPU patents.

Quiksilver (ZQK) reported third quarter results that missed estimates. Cooper Companies reported third quarter earnings that came in line, while its revenues missed estimates. The company raised its guidance for the full year.

Gap (GPS) announced that its comparable store sales for August were down 2% year-over-year compared to a 2% increase last year. Zumiez (ZUMZ) reported better than expected second quarter profit but its revenues missed expectations. The company's third quarter was also weak.

RedMed (RMD) and APEX Medical Corp have agreed to a confidential settlement agreement to resolve their outstanding patent disputes. The agreement provides APEX the right to sell and import globally its Wizard masks and XT and iCH flow generators.

Esterline's (ESL) third quarter adjusted earnings missed estimates, while its revenues were ahead of expectations.

The major Asian markets went about a lackluster run before closing mostly lower, although the Chinese and the New Zealand markets did close to the upside. Nervousness ahead of the US non-farm payrolls report and the weak close by Wall Street stocks kept sentiment subdued.

The Japanese market ended slightly lower amid uneventful trading in the yen. The Nikkei 225 average opened higher but gave back their gains over the course of the session and began to move indecisively in late trading before closing down 7.50 points or 0.05% at 15,669. Realty, resource, retail, pharma, financial, construction, utility and food stocks came under selling pressure, while export stocks ended mostly higher.

Australia's All Ordinaries languished below the unchanged line throughout the session before closing near the lows of the session. The index ended down 33.20 points or 0.59% at 5,599. The market witnessed broad based weakness, with material and healthcare stocks leading the slide, while utility stocks gained ground.

Hong Kong'sHang Seng Index closed 57.77 points or 0.23% lower at 25,240, while China's Shanghai Composite Index added 18.70 points or 0.81% before closing at 2,326.

On the economic front, preliminary report released by Japan'sCabinet Office showed that its leading economic indicators index rose 0.6 points to 106.5 in June, while economists expected a steeper improvement to 107.1. The coincident index was up 0.2 points, while the lagging index slid 0.8 points.

After the ECB-induced rally, European stocks opened lower but showed some volatility in early trading. The averages are currently trading on a lackluster note.

In corporate news, Air Berlin reported that its traffic rose 3% year-over-year in August and capacity was up 1.5%.

On the economic front, the German Federal Statistical Office reported that German industrial production rose 1.9% month-over-month in July, marking the strongest increase since March 2012, following a revised 0.4% increase in June. Economists expected industrial output growth of 0.4%.

A report from French statistical office INSEE showed that French consumer confidence held steady, with the corresponding consumer sentiment index remaining unchanged at 86 in August, belying expectations for a 1 point drop to 85.

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Source: Alliance News

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