Coffee With Greta: August Jobs Report Shows Hiring is Still Strong
DJIA Futures: +118 (+0.4%)
SPX Futures: +17 (+0.4%)
NASDAQ Futures: +45 (+0.4%)
Good morning friends!
Futures are up after the August jobs report came in as expected.
Let’s get right to it!
August Jobs Report Meets Expectations
Job growth came in as expected in August as the labor market maintains strength.
The Labor Department reported the U.S. added 315,000 jobs last month, just below expectations for a gain of 318,000.
That was a slowdown from the revised 526,000 gain in July and the softest monthly gain since April 2021.
But the data still shows hiring continuing at a strong pace, which is bad news for the Fed.
The unemployment rate rose unexpectedly to 3.7% from 3.5% as more people began actively looking for jobs.
The labor force participation rate rose by 0.3% to 62.4%, that’s still down a full 1% from pre-pandemic levels.
Average hourly earnings rose 0.3% monthly and 5.2% annually.
The Central Bank has said strong wage gains are adding to inflation pressures in the economy.
The Fed is looking for an impact on both inflation and the labor market before it will slow rate hikes.
CME Group’s FedWatch Tool shows 68% of traders expect another 0.75% rate hike later this month.
Lululemon Rallies on Earnings Beat, Strong Outlook
Lululemon Athletica (LULU) shares are rallying 9.6% ahead of the open after topping Q2 expectations and hiking its outlook.
The fitness apparel retailer reported adjusted earnings of $2.20 per share on $1.87 billion in revenue.
That topped analysts’ expectations for adjusted EPS of $1.87 on $1.774 billion in revenue.
Lululemon’s same-store sales rose 23% year over year vs 17.6% growth expected.
The CFO said, “Despite the challenges around us in the macro-environment, guest traffic in our stores and on our e-commerce sites remains robust, which speaks to the strength of our multi-dimensional operating model.”
The company now expects full-year revenue between $7.695 billion and $7.940 billion.
That’s up from the previous forecast for $7.610 billion and $7.710 billion.
Lululemon also raised its adjusted EPS expectations for 2022 to a range of $9.75 to $9.90 vs prior guidance of $9.35 to $9.50.
Starbucks Names New CEO
Starbucks (SBUX) shares are up 0.8% in premarket trade after naming a new CEO Thursday evening.
The coffee chain announced Laxman Narisimhan will take over in April 2023.
He previously served as CEO of the English consumer goods company Reckitt.
Narisimhan will join Starbucks in October and learn about the company until April.
During that time, Howard Schultz will remain interim CEO.
Schultz will remain on the board of directors when Narisimhan assumes the CEO role.
Oil Prices Rise
Oil prices are rising today as the market bets OPEC+ will discuss output cuts at next week’s meeting.
West Texas Intermediate crude futures are up 3.2% to $89 bbl while Brent crude futures are up 3% to $95 bbl.
OPEC+ slashed its 2022 demand outlook earlier this week.
The group expects demand to lag supply by 400,000 barrels per day this year but then sees a market deficit of 300,000 bpd in 2023.
Both WTI and Brent crude contracts are still on track to post their worst weekly drop in four weeks.
In Case You Missed It
- You can learn how to invest the simple and easy way with my brand new course, Today I Learned How to Invest. Learn everything you need to start building the massive nest egg you deserve, in just 45 minutes!