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DJIA Futures: -12 (-0.03%)
SPX Futures: -2 (-0.04%)
NASDAQ Futures: -62 (-0.4%)
Good morning friends!
Futures are falling as yields surge after the release of a hotter-than-expected November jobs report.
Let’s get right to it!
The U.S. economy added more jobs than expected in November.
The Labor Department reported employers hired 199,000 workers last month vs 190,000 expected.
The unemployment rate also fell unexpectedly to 3.7% vs expectations for it to remain unchanged at 3.9%.
The healthcare sector saw the largest increase, adding 77,000 jobs.
Government added 49,000, leisure and hospitality added 40,000, and manufacturing added 28,000.
The retail sector lost 38,000 jobs while transportation and warehousing lost 5,000.
Average hourly earnings rose 0.4% monthly and 4% year over year, ahead of expectations for a 0.3% monthly increase.
September’s job growth was revised lower by 35,000 to 262,000 while October was left unchanged at 150,000.
Treasury yields are rallying this morning after that labor market data.
The 10-year yield is up 7 basis points at 4.23% while the 2-year yield is up 8 basis points at 4.66%.
The unexpected drop in the unemployment rate shows the labor market maintaining resilience in the face of the Fed’s rate hikes.
CME Group’s FedWatch Tool still shows over 98% of traders expect no rate hike at next week’s meeting.
But the question of when cuts may begin in 2024 remains up in the air.
Lululemon athletica (LULU) shares are down 2.3% ahead of the open after beating Q3 expectations but issuing muted guidance.
Here’s how the athleisure retailer’s results compared to analysts’ estimates:
Sales jumped 19% year over year, up 12% in North America and 49% internationally.
But Q4 guidance was light.
Lululemon expects EPS between $4.85 and $4.93 on sales of $3.14 billion to $3.17 billion. $9.55 billion to $9.58 billion.
Analysts were forecasting EPS of $4.94 on $3.18 billion in revenue.
For the full year, the retailer forecast $9.55 billion to $9.58 billion in revenue vs $8.11 billion to $9.90 billion expected.
The company’s CFO said, “We’re pleased with the trends we’ve seen at the start of the holiday season. That being said, the majority of the quarter remains in front of us. We remain aware of the uncertainties in the macro environment, and we continue to plan a business for multiple scenarios.”