Economy Picks it Up a Gear, Market at New High!
The market’s tendency on the first day of the month to record strong gains didn’t disappoint traders yesterday. Stocks on Wall Street rallied on Thursday, each of the main indexes reaching a new historic high, after the release of a flood of economic figures which pointed to the economy picking it up a notch. The first day of June – a month that’s statistically the fourth worst performing month of the year – ended positively!
The ADP private sector jobs survey showed that 253 thousand new positions were added in the month of May, significantly above the 185 thousand consensus. The ADP numbers could signal a strong reading from the governmental employment report today before opening, a report that includes both private and public sector figures. Strong numbers today are likely to support the anticipated move on the part of the Fed to hike rates in two weeks’ time. Traders as of now are pricing in chances of 88.9% for a quarter point hike when the central bank meets for its policy meeting between June 13th-14th.
In addition to the ADP figures, a separate report yesterday showed that factory activity picked up in May after having recorded a slowdown in the previous 2 months.
In Summary for the Day: The Dow Jones rose 0.65%, the S&P 500 jumping 0.76% and the NASDAQ tacking on 0.78%. One of the stocks that stood out in yesterday’s trading was Palo Alto Networks (PANW), which soared 17.2% to $138.99, a four month high on the heels of the better than expected earnings reported by the cyber-security company.
On the negative side, the stock of Hewlett Packard (HPE) fell 6.9% to $17.52, making it the biggest weight on the S&P 500 after the company missed on the revenue front last quarter.
On the S&P 500, 28 stocks rose to new 52-week highs, 11 dipping to new yearly lows; on the NASDAQ, 82 stocks recorded new 52-week highs, 70 falling to new yearly lows.
About 6.89 billion shares changed hands on U.S. exchanges, above the 6.72 billion average over the last 20 trading days.
Friday: The hiring pace for May is expected to come out strong, analysts projecting that today’s official Labor Department employment report – to be released before opening at 8:30 N.Y. time – will record a reading of 185 thousand. The unemployment rate is expected to stay stable at 4.4%. Today’s employment report is expected to highlight widespread hiring, from business sector and professionals sector – along with the retail and manufacturing sectors, two sources of recent weakness. All four job market sectors are expected to record improvement.
Economists, though, are also eyeing the hourly wage rate, which will be released in the employment report – and which has been showing signs of acceleration. Economists expect to see a month-to-month rise of 0.2% in hourly wages, after a 0.3% rise last month. That would mean an annualized rise of 2.6% in hourly wages. A rise in wages also points to inflation in the making.
Besides the employment report, international trade figures are also expected for 8:30.
Friday’s Hot Stocks: LULU, RH, AVGO, WDAY, VMW
Have a great trading day!
|Monday||No Trading||Memorial Day|
|Wednesday||10:00||Pending home sales||–||Medium|
|Thursday||11:00||Crude Oil Inventories||Low|
|Friday||8:30||Nonfarm Private Payrolls||185K||High|
|ADI||Analog Devices, Inc.||AM||Wednesday|
|KORS||Michael Kors Holdings Limited||AM||Wednesday|
|PANW||Palo Alto Networks, Inc.||PM||Wednesday|
|HPE||Hewlett Packard Enterprise Company||PM||Wednesday|
|BUD||Anheuser-Busch InBev SA/NV||AM||Thursday|
|TECD||Tech Data Corporation||AM||Thursday|
|DG||Dollar General Corporation||AM||Thursday|
|DCI||Donaldson Company, Inc.||AM||Thursday|
|LULU||Lululemon Athletica Inc.||PM||Thursday|
|FIVE||Five Below, Inc.||PM||Thursday|
Today’s Picks – Day Trading!
New York Strategy Swing
Today’s Picks – Swing “New-York Strategy
No.1 – GLYC
|Sector||Healthcare | Biotechnology|