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Stock Enter Pre-NFP Holding Pattern, Hot Biotech Sector Slams Bears Again


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

US equity markets remained in their holding pattern ahead of Friday's big February NFP report.

The S&P 500 finished up 0.1% at 2101.04, marking the 14th straight day without a 1% day-to-day move. Prior to this stretch, the S&P made 1% moves in 14 out of 29 trading days in 2015.

The European Central Bank made no changes to its interest rate policy, as expected. At a press conference, Mario Draghi announced that the ECB would begin its quantitative easing program on Monday. The ECB will likely purchase €60 billion in assets per month until September 2016, and the program could go on beyond that should disinflationary trends continue.

Additionally, the ECB raised its growth forecasts, now seeing 1.5% growth this year vs. 1.0% previously.

European bonds and stocks rose while the euro fell against the dollar.

Overnight, China cuts its 2015 GDP forecast to 7% from 7.5%, and said it would post a significant budget shortfall.

For the second day in a row, biotech was the big story in stocks.

Drug maker Abbvie (ABBV) announced it would acquire biotech name Pharmacyclics (PCYC) for $21 billion. Pharmacyclics was the subject of takeover rumors last week.

The deal bolstered confidence in the sector, and the iShares Nasdaq Biotechnology ETF (IBB) rose 2.2%.

Biotech's momentum helped the NASDAQ Composite outperform with a 0.3% gain, despite continued profit-taking in index heavyweight Apple (AAPL), which was down 1.7%.

Economic data leaned towards the negative side today.

January Factory Orders declined 0.2% vs. expectations for a 0.2% gain, while Initial Jobless Claims were 320,000, above the 296,000 expected.

Nonfarm Productivity fell 2.2% vs. the -2.3% consensus while Unit Labor Costs were above Wall Street's forecast.

Friday's Financial Outlook

The big story tomorrow is obviously the February NFP report, which will be delivered at 8:30 a.m. ET.

According to Bloomberg, economists are expecting a 235,000 increase in nonfarm payrolls, a 5.6% unemployment rate, and a 0.2% month-over-month increase in hourly earnings.

Overseas, German Industrial Production, Euro-Zone GDP, and Bank of England/GfK Inflation expectations will be released.

Retailers Big Lots (BIG), Foot Locker (FL), and Staples (SPLS) will report earnings before the open.

Twitter: @T3Live
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