Weekly reviews

Wall Street looks ahead of US employment

Wall Street indexes traded mostly flat on Thursday as market participants looked ahead of key employment reports programmed later today.

On Thursday, investors were focused on a large number of corporate reports. Pharmaceutical giant Merck matched profit per share estimates (EPS) of 89 cents, although revenue came in a bit below expectations. Estee Lauder also showed better-than-expected EPS results but short in terms of revenue. Deutsche Bank failed to report gains in the fourth-quarter of last year. Nokia surprised among tech manufacturers, posting good results after applying a strong cost reduction strategy and acquiring Alcatel-Lucent.

  • Dow Jones Industrial Average: -0.03 percent / 19,884.91 points

  • Standard & Poor’s 500: +0.06 percent / 2,280.85 points

  • Nasdaq Composite: -0.11 percent / 5,636.20 points

In economic news, the number of people claiming for unemployment compensations dropped to 246,000, while analysts had forecasted a smaller reduction to only 250,000. Also, nonfarm productivity for the last quarter showed improvement, growing 1.3 percent against a 1.0 percent seen by economists. Unit Labor Costs decreased 1.7 percent.

Market players continued to digest the outcome of the first Federal Reserve policy meeting in 2017. The US regulator left interest rates unchanged but hinted that the economy is moving forward in the right direction for a gradual rate increase in the coming months. Benchmark rates currently stand between 0.50 percent and 0.75 percent.

Friday will be a busy day from a data perspective. The US Labor Department will release its latest report on nonfarm payrolls, participation rate, unemployment rate at 13:30 GMT. Market analysts estimated a build of 175,000 jobs in January and expect the unemployment rate to keep steady at 4.7 percent. As of 14:45 GMT, Markit will publish its composite and services PMI for January. Factory orders, ISM non-manufacturing employment and PMI will be out together at 15:00 GMT. Last but not least, traders will keep an eye on Barker Hughes weekly oil rig count.

Washington’s agenda continued to be among key factors in US equities yesterday, with President Donald Trump meeting top executives of Harley Davidson to thank them for promoting US manufacture. However, international relations weighed on markets as Associated Press reported that Trump used offensive language when talking to the Mexican President Enrique Peña Nieto. Trump said that he was ready to send US troops to stop “bad hombres” there.