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Pre-Market Primer: BlackBerry Ltd Seeks Sale by November; Employment Indicators Mixed


The preview indicators before tomorrow's jobs report have some good and bad news.

After the US Senate Foreign Relations Committee backed a resolution for limited strikes against the Syrian regime, markets are flat as the focus shifts to the US labor market.

ADP, the payroll processor, said that private sector employment grew by 176,000 in August, just 1,000 below estimates. In July, 198,000 were added to the payrolls, by ADP's count.

The outplacement firm Challenger, Gray & Christmas said that mass layoffs jumped to 50,462 in August, a 34% rise from July. Goods manufacturers were the most affected.

Initial claims for unemployment insurance fell by 9,000 last week to 323,000. Economists expected 330,000 claims. Nonfarm productivity rose 2.3% in the second quarter, while labor costs didn't budge.

These employment indicators served as a preview for tomorrow's employment situation report. Experts predict that tomorrow's headline will show 175,000 jobs added, up from 162,000 in July. The unemployment rate is likely to stay flat at 7.4%.

Still to come are US factory orders, which are expected to decline 3.4% in July, and the ISM non-manufacturing index, which economists believe will show a one-point drop to 55 in August, which still shows relatively healthy growth for services. (Readings over 50 signify growth in the sector.)

Stock futures are relatively flat after the data releases. Dow (INDEXDJX:.DJI) futures were down 0.01% at 14,915. Futures contracts on the S&P 500 (INDEXSP:.INX) fell 0.01% to 1,656.00 and Nasdaq (INDEXNASDAQ:.IXIC) futures gained 0.08% to 3,130.75.

European and Asian markets advanced as major central banks opted to stay the course today. The Bank of Japan said today that it will stick to its expansionist monetary policy, but if a proposed increase in sales tax slows the recovery, it will do more to stimulate the economy. The European Central Bank left its key interest rate unchanged at 0.5%, as did the Bank of England.

In company news, the Wall Street Journal reported that BlackBerry (NASDAQ:BBRY) could sell itself as early as November. Microsoft's (NASDAQ:MSFT) purchase of Nokia (NYSE:NOK) pretty much eliminates one rumored buyer, however.

Costco Wholesale Corp (NASDAQ:COST) shares rose 1% this morning after reporting that same-store sales rose 4% from a year earlier in August, beating analyst expectations despite lower fuel prices.

Reuters reported today that the US government is likely to approve the acquisition of Smithfield Foods (NYSE:SFD) by Shuanghui, a Chinese company. The $4.7 billion deal gives Chinese interests more control over the world's pork supply, and some considered the acquisition a national security matter.

Disclosure: Minyanville Studios, a division of Minyanville Media, has a business relationship with BlackBerry.

Twitter: @vincent_trivett
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