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Freaky Friday! Huge NFP Report, Greece Troubles Drive Volatility


Today's financial recap and tomorrow's financial outlook.

Nonfarm payrolls rose 257,000 in January, easily beating the 228,000 consensus, while November and December's numbers were revised higher by a total of 147,000.

Additionally, average hourly earnings rose 0.5% month-over-month. Economists had forecast a mere 0.3% increase.

And while the unemployment rate was higher-than-expected at 5.7%, that was because of an increase in the labor force participation rate, which implies more people are entering the workforce.

US equity markets responded favorably to the report, and the S&P 500 reached an intraday high of 2072.40, 1% off the all-time high of 2093.55. The US dollar also rose sharply, while Treasuries sold off.

In the afternoon, ratings agency Standard & Poors downgraded Greece to B- from B, which soured the bulls' mood. S&P's downgrade reflects concerns about the narrow time frame Greece has to reach a financing agreement with creditors.

However, even before the downgrade news hit the wires, the market had sold off a bit, with notable intraday weakness in risky sectors like biotech.

And later in the afternoon, Eurogroup Chief Dijsselbloem said Greece must submit a bailout extension request by February 16 instead of February 28, putting even more pressure on the market.

The S&P 500 finished at 2055.47, down 0.3%.

Financial stocks were notably strong, with the Financial Select Sector SPDR ETF (XLF) rising 0.8%. The strong jobs report served to pull forward expectations for interest rate hikes, which could improve banks' net interest margins.

Crude oil rose again today but remained volatile. Following a morning low at $50.94, it rose over $3 ahead of the release of the Baker Hughes Rig Count, which preceded a dip back down.

Shares of social media giant Twitter (TWTR) rose 16.4% to $48.01 after the company reported fourth-quarter earnings that were well ahead of Wall Street's expectations.

Action camera maker GoPro (GPRO) fared much worse. It reported fourth-quarter results that blew away consensus estimates, but its first-quarter guidance was mixed and the stock fell 13.3% to $47.12.

Yelp (YELP) also had a bad day, falling 21.5% on its disappointing 2015 outlook.

Tomorrow's Financial Outlook

There are no market-moving US economic or earnings reports on the calendar.

As of late, equity markets have roughly tracked the price oil, so the price of crude will remain an important factor in trading.

Additionally, Greece remains a source of volatility. It is close to exhausting its financial resources and under tremendous pressure to come up with a funding plan by Wednesday's emergency meeting with EU finance ministers.

Twitter: @Minyanville

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No positions in stocks mentioned.

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