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Pre-Market Primer: Job Growth Crushes Expectations; Unemployment Ticks Up


Payrolls up 171,000, unemployment up to 7.9%.

MINYANVILLE ORIGINAL Job growth in the United States blew past expectations in October. According to the Bureau of Labor Statistics, payrolls rose by 171,000. Still, 12.3 million people are unemployed, and the unemployment rate ticked up to 7.9%.

The weakest sector was government, which lost 13,000 jobs. Retail, health care, leisure, and hospitality jobs sectors saw the biggest gains.

The consensus estimates were for unemployment to edge up to 7.9% and non-farm payrolls to rise 125,000. Yesterday, ADP added to the optimism with a count of 158,000 new private sector jobs, while weekly applications for unemployment insurance sank.

August's payroll increases were revised up to 192,000 from 142,000. September's 114,000 was revised up to 148,000. A report on factory orders, due out at 10:00 a.m. EDT is expected to show a gain of 4.9% in September after declining 5.2% in August.

Stock futures were dead-flat ahead of the announcement and surged ahead after the news hit the wires. Dow (INDEXDJX:.DJI) futures rose 0.32% to 13,207.00. S&P 500 (INDEXSP:.INX) futures climbed 0.46% to 1,429.80, and Nasdaq (INDEXNASDAQ:.IXIC) futures gained 0.17% to 2,689.25.

In earnings news, Starbucks (NASDAQ:SBUX) shares rose 7.6% in after-hours trading after beating Wall Street's earnings expectations. Adjusted income for the fiscal fourth quarter was $359 million or $0.46 per share, up from $0.37 in the year-earlier period. CEO Howard Schultz said yesterday that at least 70% of the company's growth will come from Asia as the company opens up to 1,300 stores next year.

LinkedIn (NASDAQ:LNKD) also beat expectations with third quarter earnings of $0.22 per share on $252 million in sales. Though LinkedIn's pageviews have declined to 8.9 billion from a peak of 9.4 billion in the first quarter, unique visitors and membership numbers continue to climb. Revenue also continues to rise, though year-over-year growth has slowed to about 80%. Shares of LinkedIn rose 9% before the opening bell.

Apple's (NASDAQ:AAPL) iPad Mini goes on sale today. Piper Jaffray analysts predict that 1.5 million of these new devices will be sold this weekend.

Microsoft (NASDAQ:MSFT) is reportedly testing its own smartphone designs with Asian suppliers. This should give Nokia (NYSE:NOK) pause, since the Finnish company has seemingly bet its future on being the standard-bearer for Windows Phone 8.

On the other side of the pond, manufacturing data continues to foretell a recession. Eurozone manufacturing PMI for October fell to 45.4 from 46.1 in September. Any reading below 50 indicates a contraction from the month before. In Germany, the reading was 46, down from 47.4. France's headline index rose one point to 43.7, but still has it worse than Germany. Ireland was the only eurozone country to break the 50.0 mark. Austria's sank to a 40-month low of 44.8.

Twitter: @vincent_trivett
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