Market Update
Lululemon Athletica Lifted Annual Outlook After Comparable Sales Surged 14%
Scott Peters
02 Jun, 2023
New York City
Lululemon Athletica Inc soared 14% to 374.35 after the Athletic apparel retailer reported sharply higher revenue and earnings and the company lifted its full-year outlook.
Revenue in the latest quarter jumped 24% to $2.0 billion or increased 27% on a constant dollar basis.
Total comparable sales increased 14%, and comparable store sales increased 13% and direct to consumer sales jumped 16%.
Net revenue increased 17% in North America, and increased 60% internationally.
Net income increased to $290.4 million from $190 million and diluted earnings per share rose to $2.28 from $1.48 a year ago.
For the second quarter, the company estimated net revenue to be in the range of $2.14 billion to $2.17 billion, representing growth of approximately 15%.
Diluted earnings per share are expected to be in the range of $2.47 to $2.52 for the quarter.
For 2023, the retailer expects net revenue to be in the range of $9.44 billion to $9.51 billion, representing growth of approximately 17%.
Diluted earnings per share are expected to be in the range of $11.74 to $11.94 for the year.
The company revised its full-year revenue from between $9.31 billion and $9.41 billion to between $9.44 billion and $9.51 billion.
Stocks Soared and Treasury Yields Edged Up After Payrolls and Labor Market Expanded
Barry Adams
02 Jun, 2023
New York City
The latest employment situation report and the swift passage of the debt ceiling accord with bipartisan support lifted market sentiment on Wall Street.
Non-farm payrolls expanded for the 29th month in a row and job gains in May were near the monthly average over the last one year, indicating a resilient labor market.
In addition, investors reacted positively to smaller gains in wages, suggesting weaker wage inflation supporting the case for the Fed to pause aggressive rate hikes at the next policy meeting on June 14.
The combination of healthy job gains, moderate wage increases and rebound in unemployment rate offered a reason to invest to a diverse set of investors.
After a volatile week where events in Washington, D.C. dominated financial news flow, the S&P 500 is trading higher 2.6% and the Nasdaq by 3.3%.
Fitch Ratings said it will keep the U.S. "AAA" debt rating on its negative watch list, despite the recent accord to suspend its debt ceiling.
"Repeated political standoffs around the debt-limit and last-minute suspensions before the x-date (when the Treasury’s cash position and extraordinary measures are exhausted) lowers confidence in governance on fiscal and debt matters," noted the rating agency in its statement released Friday.
The latest debt accord suspended the debt ceiling until Jan 1, 2025 only after the Biden administration agreed to restrain the federal government's non-military discretionary spending, broaden work requirements for food stamps and rescinding of unspent $30 billion of Covid stimulus.
The agreement leaves the door wide open for the U.S. Congress to authorize additional funds for military and emergency programs as deemed necessary by lawmakers.
May Employment Data Highlighted Resilient Labor Market
The U.S. economy added 339,000 jobs in May, and March and April data were revised higher, the U.S. Bureau of Labor Statistics reported Friday.
Job gains occurred in professional and business services, government, health care, construction, transportation and warehousing, and social assistance.
Job gains in May were in line with the monthly average of 341,000 over the last twelve months.
Professional and business services added 64,000, government at all levels increased 56,000, health care 52,000, leisure and hospitality 48,000, construction 25,000, warehousing 24,000 and social assistance 22,000.
Expanding payrolls also attracted more people to labor markets, driving jobless rate higher, according to the Household Survey conducted by the agency.
The unemployment rate increased by 0.3 percentage point to 3.7% in May, and the number of unemployed persons rose by 440,000 to 6.1 million.
In May, average hourly earnings for all employees on private nonfarm payrolls rose by 11 cents, or 0.3%, to $33.44 and average hourly earnings have increased by 4.3% over the last 12 months.
March and April employment data were revised higher by 93,000 total.
The March employment was revised up by 52,000, from 165,000 to 217,000, and the April data was revised up by 41,000, from 253,000 to 294,000.
U.S. Indexes & Yields
The S&P 500 index increased 1.5% to 4,282.67 and the Nasdaq Composite increased 1.0% to 13,231.84.
The yield on 2-year Treasury notes increased to 4.52%, 10-year Treasury notes edged up to 3.69% and 30-year Treasury bonds held at 3.88%.
Crude oil increased $1.82 to $71.82 a barrel and natural gas prices increased 1 cent to $2.16 a thermal unit.
Traders are looking forward to OPEC+ meeting this weekend, and the crude oil prices are likely to fall sharply if oil cartel fails to announce additional production quota.
U.S. Stock Movers
Lululemon Athletica Inc soared 14% to $374.35 after the athletic apparel retailer reported sharply higher revenue and earnings and the company lifted its full-year outlook.
Revenue in the latest quarter jumped 24% to $2.0 billion and net income rose to $2.28 a share.
The company revised its full-year revenue from between $9.31 billion and $9.41 billion to between $9.44 billion and $9.51 billion.
Five Below Inc increased 6.4% to $179.43 after the deep discount retailer reported higher-than-expected earnings but the company offered a cautious outlook for the second quarter.
MongoDB Inc soared 26.7% to $372.50 after the database developer reported higher-than-expected quarterly earnings and also estimated a surge in second quarter revenue.
European Markets Rally
European markets rebounded sharply on the final day of the week after the U.S. Senate passed the debt ceiling agreement.
The bill is ready to be signed by the U.S. President Joe Biden, just in time to avert the catastrophic debt default date set by the U.S. Treasury as early as June 5.
Investors also digested the latest data on industrial production in France and a sharp decline in registered jobless people in Spain.
After a volatile week, the DAX index was nearly unchanged, the CAC 40 declined 1.5% and the FTSE 100 index decreased 0.2%.
Despite the volatility of the last two weeks rooted in the U.S. debt default worries, three leading benchmark indexes are trading near record peaks.
French Industrial Production Rebounded In April
Industrial output increased 0.8% from the previous month in April after declining 1.1% in March. France's statistical office INSEE reported Friday.
On an annual basis, industrial production rebounded 1.3% from a decline of 0.1% in March.
Output rebounded in all sectors and the sharp recovery in petroleum production led the advance.
Manufacturing production increased 0.7% from 1.1% fall after petroleum refining production soared 23.6% from 45.6% decline, electrical equipment recovered to 1.5% from 6.2% fall, mining & quarrying, energy, water supply, waste management increased 1.8% from a 1.2% decline and construction increased 0.8% from a fall of 0.9%.
Jobless On Record In Spain Dropped In May
The number of people registered as jobless in Spain, at the end of May, fell 49,260 or 1.8% from the previous month to a total of 2.74 million, the lowest for the month of May since 2008.
From a year ago, unemployment fell 183,881 or 6.29%, according to data released by the Ministry of Labor and Social Economy on Friday.
Unemployment fell across all sectors, in the services by 34,665 or 1.74%, in industry by 4,622 or 2.07%, in construction by 3,896 or 1.82% and agriculture by 2,501 or 2.30%.
By region, the largest decreases were reported in Andalucía of 6,521, in Castilla-La Mancha of 6,138 and Galicia of 4,909.
The number of registered unemployed young people aged less than 25 declined 7,208 or 3.7% to 188,043, the lowest in May since record keeping began in 1986.
A day ago, Eurostat reported Spain led the Euro Area with the highest jobless rate of 12.7% in April.
Europe Indexes & Yields
The DAX index increased 1.3% to 16,051.23, the CAC-40 index rose 1.9% to 7,270.69, and the FTSE 100 index advanced 1.6% to 7,607.25.
The yield on 10-year German Bunds inched lower to 2.28%, French bonds traded lower to 2.84%, the UK gilts held at 4.15% and Italian bonds decreased to 3.99%.
The euro edged lower to $1.077, the British pound to $1.254 and the Swiss franc to 90.52 cents.
Brent crude increased $1.81 to $76.12 a barrel and the Dutch TTF natural gas increased €0.59 to €23.69 per MWh.
Europe Stock Movers
Resource stocks extended gains for the second day in a row after copper extended gains of the last two weeks.
Antofagasta, Anglo American and Glencore jumped between 4% and 6%.
BP Plc and Shell Plc increased between 1.5% and 2.0% ahead of the OPEC+ meeting on June 4.
Traders are betting that the oil producing nations may announce additional production cuts to support the faltering oil prices, after the commodity fell 10% in May.
Dechra Pharmaceuticals plc soared 8.2% to 3,652.0 pence after the veterinary products developer agreed to go private in a £4.46 billion deal with EQT.
ProSiebenSat.1 Media SE increased 2.6% to €8.04 after the Czech investment group lifted its stake in the media company.
PayPoint Plc increased 6.5% to 402.10 pence after the company reiterated its full-year outlook.
Movers: Broadcom, Five Below, Lululemon, MongoDB, SentinelOne, Zscaler
Scott Peters
02 Jun, 2023
New York City
Lululemon Athletica Inc soared 14% to $374.35 after the athletic apparel retailer reported sharply higher revenue and earnings and the company lifted its full-year outlook.
Revenue in the latest quarter jumped 24% to $2.0 billion or increased 27% on a constant dollar basis.
Total comparable sales increased 14%, and comparable store sales increased 13% and direct to consumer sales jumped 16%.
Net revenue increased 17% in North America, and increased 60% internationally.
Net income increased to $290.4 million from $190 million and diluted earnings per share rose to $2.28 from $1.48 a year ago.
For the second quarter, the company estimated net revenue to be in the range of $2.14 billion to $2.17 billion, representing growth of approximately 15%.
Diluted earnings per share are expected to be in the range of $2.47 to $2.52 for the quarter.
For 2023, the retailer expects net revenue to be in the range of $9.44 billion to $9.51 billion, representing growth of approximately 17%.
Diluted earnings per share are expected to be in the range of $11.74 to $11.94 for the year.
The company revised its full-year revenue from between $9.31 billion and $9.41 billion to between $9.44 billion and $9.51 billion.
Five Below Inc increased 6.4% to $179.43 after the deep discount retailer reported higher-than-expected earnings but the company offered a cautious outlook for the second quarter.
Net sales in the first quarter ending in April increased 13% to 13.5% to $726.2 million from $639.6 million after comparable store sales rose 2.7%
Net income increased to $37.5 million from $32.7 million and diluted earnings per share increased to 67 cents from 59 cents a year ago.
The deep discount retailer guided fiscal second quarter net sales in the range of $755 million to $765 million based on opening approximately 40 new stores and assuming an approximate 2% to 3% increase in comparable sales.
Net income is expected to be in the range of $44 million to $48 million and diluted income per share in the range of $0.80 to $0.85 on approximately 55.9 million diluted weighted average shares outstanding.
MongoDB Inc soared 26.7% to $372.50 after the database developer reported higher-than-expected quarterly earnings and also estimated a surge in second quarter revenue.
Total revenue in the fiscal first quarter ending in April increased 29% to $368.3 million, driven by 29% jump in subscription revenue to $354.7 million and services revenue increase of 25% to $13.6 million.
Net loss increased to $54.3 million from $77.3 million and diluted earnings per share eased to 77 cents from $1.14 a year ago.
The company revised higher second quarter revenue between $388 million to $392 million and fiscal 2024 revenue between $1.522 billion to $1.542 billion.
SentinelOne Inc plunged 36.10% to $13.10 after the cybersecurity company reported lower-than-expected sales in its latest quarter and cut its annual outlook.
Revenue in the first quarter ending in April increased to $133.4 million from $78.2 million and net loss expanded to $106.8 million from $89.8 million and diluted loss per share was 37 cents compared to 33 cents a year ago.
The company estimated second quarter revenue to grow 38% to $141 million and full-year revenue between $590 million and $600 million.
Zscaler Inc increased 8.1% to $146.10 after the company reported better-than-expected quarterly results.
Revenue in the fiscal third quarter ending in April increased 46% to $418.8 million.
Net loss declined to $46.0 million, compared to $101.4 million and diluted loss per share fell to 32 cents from 72 cents a year ago.
The company estimated revenue for the fiscal fourth quarter between $429 million and $431 million and for the full-year between $1.591 billion to $1.593 billion.
Broadcom Inc increased 2.4% to $808.81 after the advanced chipmaker exceeded revenue and earnings expectations.
Revenue in the fiscal second quarter ending in April increased 8% to $8.7 billion from $8.1 billion and net income increased to $3.5 billion from %2.6 billion and diluted earnings per share rose to $8.15 from $5.93 a year ago.
The company announced a dividend of $4.60 per share payable on June 30 to stockholders of record on June 22.
The company guided fiscal third quarter revenue of $8.85 billion and adjusted operating income of 65% of projected revenue.
U.S. Economy Added 339,000 Jobs In May
Brian Turner
02 Jun, 2023
New York City
The U.S. economy added 339,000 jobs in May, and March and April data were revised higher, the U.S. Bureau of Labor Statistics reported Friday.
Despite the talks of job market slowdown and ongoing macroeconomic headwinds, payrolls in several sectors of the economy expanded at the elevated pace seen in the last twelve months.
Employers expanded payrolls in professional and business services, government, health care, construction, transportation and warehousing, and social assistance.
Job gains in May were in line with the monthly average of 341,000 over the last twelve months.
Professional and business services added 64,000, government at all levels increased 56,000, health care 52,000, leisure and hospitality 48,000, construction 25,000, warehousing 24,000 and social assistance 22,000.
Expanding payrolls also attracted more people to labor markets, driving jobless rate higher, according to the Household Survey conducted by the agency.
The unemployment rate increased by 0.3 percentage point to 3.7% in May, and the number of unemployed persons rose by 440,000 to 6.1 million.
In May, average hourly earnings for all employees on private nonfarm payrolls rose by 11 cents, or 0.3%, to $33.44 and average hourly earnings have increased by 4.3% over the last 12 months.
March and April employment data were revised higher by 93,000 total.
The March employment was revised up by 52,000, from 165,000 to 217,000, and the April data was revised up by 41,000, from 253,000 to 294,000.
Resilient Labor Market In May Drives Stocks Higher
Barry Adams
02 Jun, 2023
New York City
Stocks advanced and Treasury yields held stable after the release of the latest labor market report.
Non-farm payrolls expanded for the 29th month in a row and job gains in May were near the monthly average over the last one year, indicating a resilient labor market.
In addition, investors reacted positively to smaller gains in wages, suggesting weaker wage inflation supporting the case for the Fed to pause aggressive rate hikes at the policy meeting on June 14.
The combination of healthy job gains, moderate wage increases and rebound in unemployment rate was positive for stocks.
After a volatile week where events in Washington, D.C. dominated financial news flow, the S&P 500 is trading higher 2% and the Nasdaq by 3%.
May Employment Data Highlighted Resilient Labor Market
The U.S. economy added 339,000 jobs in May, and March and April data were revised higher, the U.S. Bureau of Labor Statistics reported Friday.
Job gains occurred in professional and business services, government, health care, construction, transportation and warehousing, and social assistance.
Job gains in May were in line with the monthly average of 341,000 over the last twelve months.
Professional and business services added 64,000, government at all levels increased 56,000, health care 52,000, leisure and hospitality 48,000, construction 25,000, warehousing 24,000 and social assistance 22,000.
Expanding payrolls also attracted more people to labor markets, driving jobless rate higher, according to the Household Survey conducted by the agency.
The unemployment rate increased by 0.3 percentage point to 3.7% in May, and the number of unemployed persons rose by 440,000 to 6.1 million.
In May, average hourly earnings for all employees on private nonfarm payrolls rose by 11 cents, or 0.3%, to $33.44 and average hourly earnings have increased by 4.3% over the last 12 months.
March and April employment data were revised higher by 93,000 total.
The March employment was revised up by 52,000, from 165,000 to 217,000, and the April data was revised up by 41,000, from 253,000 to 294,000.
U.S. Indexes & Yields
The S&P 500 index increased 0.96% to 4,261.99 and the Nasdaq Composite increased 1.1% to 13,243.61.
The yield on 2-year Treasury notes increased to 4.41%, 10-year Treasury notes edged up to 3.64% and 30-year Treasury bonds held at 3.84%.
Crude oil increased $1.62 to $71.72 a barrel and natural gas prices increased 1 cent to $2.16 a thermal unit.
Traders are looking forward to OPEC+ meeting this weekend, and the crude oil prices are likely to fall sharply if oil cartel fails to announce additional production quota.
U.S. Stock Movers
Lululemon Athletica Inc soared 14% to 374.35 after the Athletic apparel retailer reported sharply higher revenue and earnings and the company lifted its full-year outlook.
Revenue in the latest quarter jumped 24% to $2.0 billion and net income rose to $2.28 a share.
The company revised its full-year revenue from between $9.31 billion and $9.41 billion to between $9.44 billion and $9.51 billion.
Five Below Inc increased 6.4% to $179.43 after the deep discount retailer reported higher-than-expected earnings but the company offered a cautious outlook for the second quarter.
MongoDB Inc soared 26.7% to $372.50 after the database developer reported higher-than-expected quarterly earnings and also estimated a surge in second quarter revenue.
Europe Movers: Dechra Pharma, PayPoint, ProSiebenSat.1.Media, Resource Stocks
Bridgette Randall
02 Jun, 2023
Frankfurt
The DAX index increased 1.0% to 16,009.90, the CAC-40 index rose 1.1% to 7,221.98, and the FTSE 100 index advanced 1.0% to 7,561.45.
The yield on 10-year German Bunds inched lower to 2.28%, French bonds traded lower to 2.84%, the UK gilts held at 4.15% and Italian bonds decreased to 3.99%.
Resource stocks extended gains for the second day in a row after copper extended gains of the last two weeks.
Antofagasta, Anglo American and Glencore jumped between 4% and 6%.
BP Plc and Shell Plc increased between 1.5% and 2.0% ahead of the OPEC+ meeting on June 4.
Traders are betting that the oil producing nations may announce additional production cuts to support the faltering oil prices, after the commodity fell 10% in May.
Dechra Pharmaceuticals plc soared 8.2% to 3,652.0 pence after the veterinary products developer agreed to go private in a £4.46 billion deal with EQT.
The acquisition price of 3,874 pence represents a premium of approximately 44%. to the closing price of 2,690 pence on April 12, the last trading day before the offer period began.
ProSiebenSat.1 Media SE increased 2.6% to €8.04 after the Czech investment group lifted its stake in the media company.
PayPoint Plc increased 6.5% to 402.10 pence after the company reiterated its full-year outlook.
In the trading update released today, the company confirmed total sales in the fiscal year ending in March 2023, excluding Appreciate Group, is expected to be around £125 million from £115.1 million a year ago.
The payment processor also confirmed its earnings are likely to be near the top end of the market expectations.
European Markets Rally, French Industrial Production Rebounded, Jobless On Record In Spain Dropped
Bridgette Randall
02 Jun, 2023
Frankfurt
European markets rebounded sharply on the final day of the week after the U.S. Senate passed the debt ceiling agreement.
The bill is ready to be signed by the U.S. President Joe Biden, just in time to avert the catastrophic debt default date set by the U.S. Treasury as early as June 5.
Investors also digested the latest data on industrial production in France and a sharp decline in registered jobless people in Spain.
After a volatile week, the DAX index was nearly unchanged, the CAC 40 declined 1.5% and the FTSE 100 index decreased 0.2%.
Despite the volatility of the last two weeks rooted in the U.S. debt default worries, three leading benchmark indexes are trading near record peaks.
French Industrial Production Rebounded In April
Industrial output increased 0.8% from the previous month in April after declining 1.1% in March. France's statistical office INSEE reported Friday.
On an annual basis, industrial production rebounded 1.3% from a decline of 0.1% in March.
Output rebounded in all sectors and the sharp recovery in petroleum production led the advance.
Manufacturing production increased 0.7% from 1.1% fall after petroleum refining production soared 23.6% from 45.6% decline, electrical equipment recovered to 1.5% from 6.2% fall, mining & quarrying, energy, water supply, waste management increased 1.8% from a 1.2% decline and construction increased 0.8% from a fall of 0.9%.
Jobless On Record In Spain Dropped In May
The number of people registered as jobless in Spain, at the end of May, fell 49,260 or 1.8% from the previous month to a total of 2.74 million, the lowest for the month of May since 2008.
From a year ago, unemployment fell 183,881 or 6.29%, according to data released by the Ministry of Labor and Social Economy on Friday.
Unemployment fell across all sectors, in the services by 34,665 or 1.74%, in industry by 4,622 or 2.07%, in construction by 3,896 or 1.82% and agriculture by 2,501 or 2.30%.
By region, the largest decreases were reported in Andalucía of 6,521, in Castilla-La Mancha of 6,138 and Galicia of 4,909.
The number of registered unemployed young people aged less than 25 declined 7,208 or 3.7% to 188,043, the lowest in May since record keeping began in 1986.
A day ago, Eurostat reported Spain led the Euro Area with the highest jobless rate of 12.7% in April.
Europe Indexes & Yields
The DAX index increased 1.0% to 16,009.90, the CAC-40 index rose 1.1% to 7,221.98, and the FTSE 100 index advanced 1.0% to 7,561.45.
The yield on 10-year German Bunds inched lower to 2.28%, French bonds traded lower to 2.84%, the UK gilts held at 4.15% and Italian bonds decreased to 3.99%.
The euro edged lower to $1.077, the British pound to $1.254 and the Swiss franc to 90.52 cents.
Brent crude increased $1.17 to $75.40 a barrel and the Dutch TTF natural gas increased €0.84 to €23.95 per MWh.
Europe Stock Movers
Resource stocks extended gains for the second day in a row after copper extended gains of the last two weeks.
Antofagasta, Anglo American and Glencore jumped between 4% and 6%.
BP Plc and Shell Plc increased between 1.5% and 2.0% ahead of the OPEC+ meeting on June 4.
Traders are betting that the oil producing nations may announce additional production cuts to support the faltering oil prices, after the commodity fell 10% in May.
Dechra Pharmaceuticals plc soared 8.2% to 3,652.0 pence after the veterinary products developer agreed to go private in a £4.46 billion deal with EQT.
ProSiebenSat.1 Media SE increased 2.6% to €8.04 after the Czech investment group lifted its stake in the media company.
PayPoint Plc increased 6.5% to 402.10 pence after the company reiterated its full-year outlook.
Momentum Lifts Averages Higher, Reports Confirm Tight Labor Market Conditions
Barry Adams
01 Jun, 2023
New York City
Market indexes picked up pace in early afternoon trading and scaled higher as investors digested the latest data on the jobs market.
Private sector payrolls expanded at a slower pace in May and weekly jobless claims edged up slightly but stayed significantly below the elevated level in March.
The tight labor market conditions and broader optimism about the economy dominated trading sentiment, despite the weak manufacturing survey data.
The U.S. manufacturing purchasing managers' survey showed the index tracking the confidence in the sector declined for the seventh month in a row in May.
The ISM PMI decreased to 46.9 from 47.1 in April, and indexes tracking new orders, backlogs and inventories contracted in the month.
On Wall Street, buyers returned after the U.S. House passed the debt ceiling agreement after months of protracted and contentious negotiations that brought the nation closer to its first ever debt default.
The so-called Fiscal Responsibility Act passed 314-117, with 165 Democratic votes and 149 Republican votes.
The bill is expected to face a far smoother transition in the upper chamber of the Democratic-controlled Senate and sent to President Biden's signature, just in time to avert the expected default date June 5.
With the anticipated ratification of the debt ceiling agreement, market focus is shifting to rate path and the Fed's action at its next meeting on June 14.
Private Payrolls Growth Slowed In May
Private payrolls expanded in May at a slower pace, according to the latest survey by ADP.
Employers added 278,000 jobs in May, compared to a downwardly revised 291,000 additions in April.
The services sector added 168,000, led by 208,000 gains in leisure and hospitality and 32,000 in trade, transportation, utilities.
Payrolls were trimmed in the financial sector by 35,000, education and health by 29,000, information by 15,000 and professional and business by 5,000.
However, the goods-producing industry added 110,000 jobs, driven by gains in mining of 94,000 and construction 64,000 while manufacturing lost 48,000 jobs.
Job gains were limited to leisure and hospitality, construction and mining industries while manufacturing and finance trimmed positions.
"This is the second month we've seen a full percentage point decline in pay growth for job changers.
Pay growth is slowing substantially, and wage-driven inflation may be less of a concern for the economy despite robust hiring," said ADP's chief economist Nela Richardson.
U.S. Jobless Weekly Claims Edged Higher
Initial claims of jobless benefits increased by 2,000 from the previous week to 232,000 in the week ending on 232,000.
The jobless claims were below the levels seen in March, indicating that tight labor market conditions are likely to persist for months ahead.
The four week moving average, which removes the weekly volatility, eased 2,500 to 229,500.
On a seasonally unadjusted basis, claims rose 5,296 to 207,941 and Ohio and New York logged an increase of 2,133 and 1,277 respectively.
U.S. Indexes & Yields
The S&P 500 index increased 0.9% to 4,217.20 and the Nasdaq Composite increased 1.2% to 13,089.17.
The yield on 2-year Treasury notes decreased to 4.37%, 10-year Treasury notes edged down to 3.59% and 30-year Treasury bonds held at 3.82%.
Crude oil increased $2.64 to $70.73 a barrel and natural gas prices increased 9 cents to $2.17 a thermal unit.
In May, crude oil declined 9.5% and plunged 39% from a year ago.
U.S. Stock Movers
Nordstrom Inc increased 3% to $15.76 after the company reported better-than-expected quarterly results.
Salesforce Inc declined 5% to $212.38 after the company highlighted softness in large account sales activities.
Macy's Inc declined 4.8% to $12.94 after the company reported weak quarterly results and lowered its annual outlook citing macroeconomic headwinds.
The company lowered its full-year revenue estimate to between $22.8 billion from $23.2 billion from between $23.7 billion and $24.2 billion in the previous estimate.
Dollar General Corp plunged 18.4% to $164.40 after the deep discount retailer estimated same store sales in the current year between 1% and 2%, weaker-than-estimated.
European Markets Rebounded, Inflation Eased, Jobless Rate Fell to New Low
European markets rebounded after the jobless rate fell to a new low and inflation eased to the level last seen thirteen months ago.
Inflation pressures eased after energy prices declined and food inflationary pressures weakened, supporting the case for the central bank to consider pausing aggressive rate hikes.
Stocks responded positively to tight labor market conditions after the jobless rate dropped to a new record low since record keeping began in 1995.
Market optimism was bolstered after the debt ceiling agreement was passed by an overwhelming majority in the U.S. House of Representatives, raising hopes of smoother passage in the Senate before the critical deadline on June 5.
Crude oil hovered around the recent lows after a private survey in China showed the manufacturing sector unexpectedly expanded in May.
The Caixin China Manufacturing General Manufacturing PMI increased to 50.9 in May from 49.5 in April. The survey focuses more on companies in the private sector.
The reading above 50 indicates expansion and below shows a contraction.
A day ago, an official manufacturing industry survey, which is heavily focused on large government controlled enterprises, showed a contraction.
Eurozone Inflation Eased In May
The consumer price inflation in the Euro Area slowed in May after energy prices fell and food inflation slowed, the Eurostat reported Thursday.
Core inflation, which excludes food, energy, alcohol and tobacco, eased to 5.3% from 5.6% in April.
Consumer price index eased to 6.1% in May from 7.0% in April and fell to the slowest pace since February 2022.
Energy prices declined 1.7% in the month after rising 2.4% in April and food, alcohol and tobacco inflation eased to 12.5% from 13.5%, non-energy industrial goods inflation weakened to 5.8% from 6.2% and service inflation ebbed to 5.0% from 5.2%.
New Record Low Jobless Rate In Eurozone
The euro area seasonally-adjusted unemployment rate declined to 6.5% in April from 6.6% in March and from 6.7% from a year ago, the statistical office of the European Union or Eurostat reported Thursday.
The jobless rate in the currency union dropped to the lowest level since record keeping began in 1995.
In the currency union, the number of unemployed fell 33,000 from the previous month to 11.088 million and declined 203.000 from a year ago.
Youth unemployment, those younger than 25, declined to 13.9% in April from 14.0% in March and about 2.2 million were unemployed.
Of the largest economies in the Euro Area, Germany recorded a jobless rate of 2.9%, in France 7.0%, in Italy 7.8% and Spain 12.7%.
Europe Indexes & Yields
The DAX index increased 1.1% to 15,838.66, the CAC-40 index rose 0.7% to 7,150.96, and the FTSE 100 index advanced 0.5% to 7,481.20.
The yield on 10-year German Bunds inched higher to 2.29%, French bonds traded higher to 2.87%, the UK gilts held at 4.19% and Italian bonds decreased to 4.08%.
The euro edged lower to $1.07, the British pound to $1.245 and the Swiss franc to 90.82 cents.
Brent crude decreased $0.38 to $72.20 a barrel and the Dutch TTF natural gas increased €2.80 to €24.05 per MWh.
Europe Stock Movers
Lonza Group AG increased 1.2% to CHF 576.20 after the Swiss manufacturing company agreed to acquire Holland-based Synaffix, the developer of antibody drug conjugates.
FLSmidth & Co advanced 2.7% to DKK 296.80 after the Danish company agreed to acquire the U.S. based Morse Rubber, the maker of rubber products for marine, industrial and mining applications.
BAE Systems Plc increased 1.1% to 939.20 pence after the company said it has hired Morgan Stanley to launch the repurchase of £500 million of its own stock.
Safran SA advanced 1.5% to €137.46 after the company said it entered into exclusive negotiation with Air Liquide SA to purchase its aeronautical oxygen and nitrogen business, excluding cryogenic business related to marine applications.
Dr Martens PLC dropped 8.5% to 143.0 pence after the UK-based boot maker said its operating margin is likely to fall this year.
Revenue in the fiscal year 2023 ending in March increased 10% to £1.0 billion but profit after-tax declined 28% to £128.9 million from £181.2 million a year ago.
The company recommended a final dividend of 4.28 pence, matching the previous year and increasing the total dividend to 5.84 pence, an increase of 6% from a year ago.
The company estimated operating earning margin to fall between 1% and 2% because of the need to invest in the supply chain to support long term sales growth.
Movers: Chewy, Dollar General, Macy's, Nordstrom, Salesforce
Scott Peters
01 Jun, 2023
New York City
Nordstrom Inc increased 3% to $15.76 after the company reported better-than-expected quarterly results.
The company reaffirmed its revenue and adjusted financial outlook for fiscal 2023 and revenue is estimated to fall between 4% and 6%, including an approximately 250 basis point negative impact from the wind-down of Canadian operations and an approximately 130 basis point positive impact from the 53rd week in the current year.
Net sales declined 11.6% to $3.0 billion from $3.5 billion and the company swung to a loss of $205 million from a profit of $20 million and diluted earnings per share was ($1.27) compared to 13 cents a year ago.
Salesforce Inc declined 5% to $212.38 after the company highlighted softness in large account sales activities.
Revenue in the first quarter ending in April increased 11% to $8.25 billion from $7.4 billion and net income jumped to $199 million from $28 million and diluted earnings per share advanced to 20 cents from 3 cents a year ago.
The company reiterated its full-year fiscal 2024 revenue to fall 10% to between $34.5 billion and $334.7 billion and GAAP earnings between $2.67 and $2.69.
The company estimated fiscal second quarter revenue range between $8.51 billion and $8.53 billion and GAAP earnings per share between 79 cents and 80 cents.
Macy's Inc declined 4.8% to $12.94 after the company reported weak quarterly results and lowered its annual outlook citing macroeconomic headwinds.
Net sales in the quarter declined 7% to $4.98 billion from $5.4 billion and net income plunged to $155 million from $286 million and diluted earnings per share fell to 56 cents from 98 cents a a year ago.
Digital sales declined 8% and retail store sales fell 6% from a year ago.
Comparable store sales at locations owned by the company declined 7.9% and fell 7.2% including licensed sales.
The company lowered its full-year revenue estimate to between $22.8 billion from $23.2 billion from between $23.7 billion and $24.2 billion in the previous estimate.
Dollar General Corp plunged 18.4% to $164.40 after the deep discount retailer lowered its same store sales in the current year to between 1% and 2% from the previous estimate between 3.0% and 3.5%.
The retailer also lowered its net sales growth estimate in the current year to between 3.5% and 5.0% from the previous estimate between 5.5% and 6.0%.
Net sales in the quarter increased 6.8% to $9.3 billion and net income declined to $514.8 million from $552.6 million and diluted earnings per share fell to $2.34 from $2.41 a year ago.
As of May 5, 2023, total merchandise inventories, at cost, were $7.3 billion compared to $6.1 billion as of April 29, 2022, an increase of 14.7% on a per-store basis.
This increase primarily reflects the impact of product cost inflation.
The company declared quarterly dividend of 59 cents a share, payable on or before July 25 to shareholders on record July 11.
Chewy Inc soared 23.5% to $36.43 after the online retailer of pet foods reported better-than-expected quarterly results.
Net sales in the fiscal first quarter increased 14.7% to $2.78 billion and net income increased to $22.2 million from $18.5 million and diluted earnings per share rose to 5 cents from 4 cents a year ago.