Following a strong day in the markets on Tuesday, futures began today down a tad, but this was prior to a very strong jobs report from ADP (ADP), the premier private-sector payroll firm in the nation. New private-sector jobs rose 214K in February according to ADP, well ahead of the 185K expected.
January jobs numbers from ADP were revised down 12K to 193K, but the good news is the 200K+ average over the past 2 months (not including government jobs) is another arrow in the quiver of a sound U.S. economy. This may not be enough to force the Fed’s hand to raise interest rates at its next meeting, but it does continue the narrative that the U.S. continues to lead the global economy at this time.
Breaking down the numbers, both small and large-sized businesses grew by 76K last month, and medium-sized (between 50-500 employees) jobs numbers rose by 62K. The one segment that was weaker for the month was Manufacturing at -9K, but Financials were up 8K, Transportation +20K, Construction +27K and Business Services up a whopping 59K in February. It would seem white-collar enterprise-related employment is acting on pent-up demand after many months of struggling to keep up with other segments like Construction.
Perhaps these positive numbers push the needle for expectations about this Friday’s Bureau of Labor Statistics (BLS) non-farm payroll report, but even if they don’t, those numbers have helped the same “strength in the U.S.” narrative recently. We saw 151K new jobs overall for January’s BLS, with an unemployment rate at 4,9 percent. The number of unemployed persons in the country was 7.8K last month, which actually means economists consider we are near “full employment.”
In earnings news — what’s left of it — Brown-Forman (BF.A) reported in-line earnings prior to the opening bell today, whereas revenues missed analyst expectations. Shares had built up over the past week, but pulled back ahead of the earnings announcement; we’ll see where its stock price goes from here. After the closing bell today, we’ll hear from Costco (COST) on quarterly earnings.
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