Coffee With Greta: Hot Jobs Report
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Good morning friends!
Futures are higher as traders digest a hotter-than-expected May jobs report and the debt ceiling bill passes Congress.
Let’s get right to it!
Job Growth Surges In May
The U.S. economy added far more jobs than expected in May.
The Labor Department reported nonfarm payrolls rose by 339,000 last month while the unemployment rate jumped to 3.7% from 3.4% in April.
The gain was sharply higher than economists’ expectations for 190,000 jobs.
But the unemployment rate rose more than expectations for 3.5%>
The higher unemployment rate is a signal more workers may now be searching for a job.
Hourly wages rose 0.3% monthly as expected and 4.3% year over year, just below 4.4% expected.
April’s job growth was also revised higher to 294,000 from 265,000 previously while March was revised up to 217,000 from 165,000.
Senate Passes Debt Ceiling Bill
The debt ceiling bill is now headed to President Biden’s desk after the Senate passed the legislation Thursday evening.
The upper chamber approved the Fiscal Responsibility Act in a 63-36 vote.
Biden is now expected to sign the bill today and address the nation at 7:00 p.m. ET.
In a statement after the Senate vote, Biden said, “No one gets everything they want in a negotiation, but make no mistake: This bipartisan agreement is a big win for our economy and the American people.”
The Treasury Department had given Congress a June 5 deadline to raise the debt ceiling in order to avoid a default.
The legislation suspends the debt limit until January 1, 2025.
Lululemon Surges As Sales Jump
Lululemon Athletica (LULU) shares are up 14.9% ahead of the open after beating fiscal Q1 expectations and hiking its full-year outlook.
Here’s how the athleisure retailer’s results compared to analysts’ estimates:
- EPS: $2.28 vs $1.98 expected
- Revenue: $2 billion vs $1.93 billion expected
Revenue jumped 25% year over year as the company’s sales in China recovered.
Revenue in China surged 79% from a year ago.
The CFO said, “Our Q1 results were strong as guests responded well to our product offering in all our markets across the globe. A meaningful acceleration in our China sales trend, coupled with lower air freight, contributed to our better than planned financial performance.”
Lululemon now expects full-year revenue of $9.44 billion to $9.51 billion up from $9.31 billion to $9.41 billion previously.
The company also forecast full-year EPS of $11.74 to $11.94 vs its previous forecast for $11.50 to $11.72.
Dell Tops Q1 Expectations
Dell Technologies (DELL) shares are falling 2.1% in premarket trade despite beating fiscal Q1 expectations.
Here’s how the computer maker’s results compared to analysts’ estimates:
- Adjusted EPS: $1.31 vs $0.86 expected
- Revenue: $20.9 billion vs $20.3 billion expected
That revenue beat came even as sales dropped 20% year over year.
Dell’s PC business, the Client Solutions Group, brought in $12 billion in revenue which was down 23% from a year ago but better than $11.4 billion expected.
The company also reported improving margins as component costs fall.