U.S. Jobless Rate at 8.1%, Net New Jobs Additions Slows to 115,000

Arthi Gupta
04 May, 2012
New York City

U.S. indexes fell after employers added less jobs than estimated in April as the weather played a key role in altering hiring pattern and the unemployment rate declined. Affymetrix and eBioscience amended merger agreement. LinkedIn agreed to acquire SlideShare for $118.75 million.

[R]9:40 AM New York – U.S. indexes fell after employers added less jobs than estimated in April as the weather played a key role in altering hiring pattern and the unemployment rate declined. Affymetrix and eBioscience amended merger agreement. LinkedIn agreed to acquire SlideShare for $118.75 million.[/R]

U.S. indexes dropped after employers added fewer jobs than estimated in April and new additions declined for the third month in a row.

The U.S. jobs report is most widely watched around the world and generally sets the tone for trading. Warmer weather played a key role in changing the hiring pattern in winter and spring months and employers added more jobs in winter months and lot of new jobs additions were pulled forward.

The European indexes dropped after the latest batch of data offered weakening economic snapshot across the region. The economic activities are declining in the region and the activities in the service and manufacturing sectors are dropping at a 0.5% quarterly rate.

Traders are also looking ahead of the elections results in France, Germany, Italy and Greece this weekend and the outcome may force the politicians to back off their commitment to austerity measures.

Asian markets traded lower after the Reserve Bank of Australia lowered the inflation and growth outlook for the economy.

China''s service sector growth rose in April, a survey by Markit Economics showed today. The headline HSBC business activity index rose to a six-month high of 54.1 in April from 53.3 in March.

U.S. Jobless Rate Falls

April non-farm payroll employment rose 115,000 from the revised 154,000 in March, but higher than initially estimated, according to data released by the U.S. Labor Department today.

The unemployment rate declined to 8.1% in April from the 8.2% reported in March.

The government revised its payroll increase estimate by a combined 53,000 in February and March and the six month average growth at 197,000. Private sector added 130,000 net new jobs and government at all levels cut staff by 15,000.

U.S. GDP is now ahead of the 2007 level with 5 million fewer jobs as businesses adjust to higher productivity increases in the last four years and sixteen million people are still looking for full time positions.

Affymetrix and eBioscience Amend Merger Agreement

Affymetrix, Inc., and eBioscience, Inc. amended their existing agreement dated November 29, 2011 under which Affymetrix will acquire eBioscience.

Under the terms of the amended agreement, Affymetrix will acquire eBioscience for $315 million in cash and believes the acquisition will create significant new commercial opportunities in the post-genomic applications of immunology and oncology.

LinkedIn to Acquire SlideShare

LinkedIn agreed to acquire SlideShare, a leading professional content sharing community.

The transaction is valued at approximately $118.75 million, subject to adjustment, in a combination of approximately 45% cash and approximately 55% stock.

Earnings Review

Ameren Corp. ((AEE)), the utility holding company reported first quarter total operating revenues fell 12.6% to $1.66 billion, from $1.90 billion in the prior-year quarter. Net loss in the quarter was $403 million or $1.66 per diluted share compared with net income of $71 million or 29 cents per share last year.

Buckeye Partners, L.P. ((BPL)), a master limited partnership reported first quarter total revenue rose moderately 0.8% to $1.26 billion from $1.25 billion last year. Net income in the quarter fell 21.8% to $52.0 million or 54 cents per diluted unit compared to net income of $66.5 million or 79 cents per diluted unit.

Duke Energy Corporation ((DUK)), the energy company reported first quarter operating revenues dropped 0.8% to $3.63 billion from $3.66 billion a year earlier. Net income in the quarter plunged 42% to $295 million or 22 cents per diluted share compared to net income of $511 million or 38 cents per share last year.

Estee Lauder Companies Inc. ((EL)), the maker of skin care and cosmetics reported third quarter net sales grew 4% to $2.25 billion from $2.17 billion in the previous year. Net earnings for the quarter climbed 5% to $130.4 million or 33 cents per diluted share compared to net earnings of $124.7 million or 31 cents per share a year ago.