Before the Open (Sep 4)

Good morning. Happy Friday. Happy Employment Numbers Day.
The Asian/Pacific markets closed mostly down. Japan and India dropped more than 2%; South Korea, Taiwan and Singapore lost more than 1%. Europe is currently mostly down. Germany, France, Netherlands and Italy are down more than 2%; London, Austria, Norway, Sweden, Switzerland, Denmark, Finland, Hungary, Spain, Belgium and Portugal are down more than 1%. Futures here in the States point towards a relative big gap down open, but things can certainly change when the employment numbers are released.
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The dollar is down. Oil and copper are down. Gold and silver are down. Bonds are up.
Here are the employment numbers…
unemployment rate: 5.1% (was 5.3% last month)
nonfarm payrolls: +173K (was +215K last month)
private payrolls:
average workweek: up 0.1 hours to 34.6 hours
hourly wages: up 0.3% to $25.09 (up 2.2% in last 12 months)
labor participation rate: same at 62.6% (unchanged, lowest in 38 years)
June job gain increased from 231K to 245K.
July job gain increased from 215K to 245K.
On the news, S&P futures spiked up but immediately came back down and are flat relative to the pre-news level.
Everyone is talking about how important these jobs numbers are because they’ll partially dictate what the Fed does. That’s garbage. If the Fed really was data-dependent they would have raised rates a while ago because the unemployment rate has been low enough for long enough. The Fed isn’t data-dependent right now. They’re stock market-dependent. If the market goes up, they’ll raise. If the market drops, they’ll hold off. Simple as that. The Fed is terrified the market may drop, and despite the knowledge in the room at the time a decision is made, the stock market will dictate when they raise rates.
I looked at a lot of charts yesterday and found almost nothing worth trading. Don’t churn your account.
Overall bias remains to the downside. Unless the internals improve significantly, the lows will be test and likely taken out. More after the open.
Stock headlines from barchart.com…
Caterpillar (CAT -2.17%) was downgraded to ‘Neutral’ from ‘Outperform’ at Baird.
British Petroleum (BP +0.65%) was downgraded to ‘Underperform’ from ‘Neutral’ at BofA/Merrill Lynch.
Ciena (CIEN +2.18%) was downgraded to ‘Hold’ from ‘Buy’ at Deutsche Bank.
Dollar Tree (DLTR -0.87%) was upgraded to ‘Buy’ from ‘Neutral’ at BofA/Merrill Lynch.
Teekay Tankers (TNK +3.38%) was upgraded to ‘Buy’ from ‘Sell’ at UBS.
Infineon (IFNNY +0.57%) was upgraded to ‘Overweight’ from ‘Neutral’ at JPMorgan Chase.
Adidas (ADDDY) was initiated with an ‘Outperform’ at Exane BNP Paribas.
Gabelli reported an 11.27% stake in CTS Corporation (CTS +0.43%).
Esterline (ESL +0.38%) reported Q3 adjusted EPS of $1.33, weaker than consensus of $1.42 and then lowered guidance on fiscal 2015 adjusted EPS to $4.35-$4.45, below consensus of $4.71.
UTi Worldwide (UTIW -4.11%) reported a Q2 EPS loss of -70 cents, a much bigger loss than consensus of -5 cents.
The Gap (GPS +1.13%) reported August Same-Store-Sales were down 2% y/y and August revenue of $1.20 billion was below the $1.23 billion from last year.
Cooper Companies (COO -0.67%) reported Q3 EPS of $1.97, higher than consensus of $1.95.
Verifone (PAY +0.58%) fell 5% in after-hours trading after it reported Q3 adjusted EPS of 47 cents, better than consensus of 46 cents, but then lowered guidance on fiscal 2015 adjusted EPS to $1.82-$1.83, below consensus of $1.85.
Gamco reported a 7.15% stake in Crane (CR +0.14%).
Earnings and Economic Numbers from seekingalpha.com…
Today’s Economic Calendar
8:30 Non-farm payrolls
Today’s Earnings here
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers