U.S. markets got a punch to the gut early this morning, after the Labor Department reported the creation of only 142,000 new jobs in September — a far cry from the street’s expected number of 203,000.
In addition, both the July and August unemployment numbers were revised significantly lower. July’s number was reduced from 245,000 to 223,000, while August’s numbers went from 173,000 to 136,000. The unemployment rate remained at 5.1%.
The September report, along with the revisions put a major crimp in the Fed’s ability to hike interest rates before the end of 2015, and traders were not at all happy at first. All three indices were down over 1% early on.
Adding fuel to the fire was the Commerce Department’s report of a decline of 1.7% on the August factory orders, which was the biggest decline since February of this year. The chances for a global slowdown seem to be increasing lately, which had markets uneasy.
But things turned around near mid-morning, and the indices came roaring back in the afternoon to finish higher — the biggest reversal day in some four years. Traders apparently had a change of heart about life without a Fed rate hike.
The Dow Jones Industrial Average rose 1.2%, while the S&P 500 was 1.4% higher, and the Nasdaq gained 1.7%. Sectors were a sea of green across the board, with energy a huge winner on the day.
While most stocks had mild gains, Micron Technology, Inc. (NASDAQ:MU), Wynn Resorts, Limited (NASDAQ:WYNN) and Newmont Mining Corp (NYSE:NEM) were among those that really surged, making them three of today’s best stocks.
Micron Technology, Inc. (MU)
Micron Technology stock was in full force today after the chipmaker reported fourth-quarter earnings late Thursday. MU earned 37 cents per share on $3.6 billion in revenue, well ahead of analysts’ estimates for 34 cents a share on $3.57 billion in revenue.
It was an interesting report because the street anticipated that recent price decreases of dynamic random-access memory (DRAM) chips would hurt the bottom line for Micron and other chipmakers.
That obviously wasn’t the case; however, MU issued forward guidance of 20 cents to 26 cents per share on revenue of $3.35 billion for the first quarter of 2016. Those figures were below the street’s view of 37 cents on revenue of $3.35 billion to $3.6 billion.
Even with that cold shower, MU stock was still up more than 7% for the day.
Wynn Resorts, Limited (WYNN)
WYNN stockholders were rolling 7’s today, after the Chinese Government said it will pledge its support to Macau’s economy in all aspects. The support may include future approval of maritime expansion, and help for Macau’s tourism.
Macau has seen a consistent decline in gambling revenue over the last 16 months, so any support that can be given to prop up tourism, which will likely include casino visits, can only help WYNN.
WYNN finished the day up a blistering 23%. Other casino stocks, such as Las Vegas Sands Corp. (NYSE:LVS) and MGM Resorts International (NYSE:MGM), also traded higher today in sympathy.
Newmont Mining Corp (NEM)
The weak jobs report this morning gave the precious metals sector a lift, as it drastically reduced the odds of a Fed rate hike any time soon. Amid that news, gold and silver stocks had a big day, especially NEM stock, which rallied almost 8%.
Other issues that also did well today were Barrick Gold Corporation (USA) (NYSE:ABX) and Goldcorp Inc. (USA) (NYSE:GG), as well as silver stocks such as First Majestic Silver Corp (NYSE:AG).
As of this writing, Ethan Roberts did not hold a position in any of the aforementioned securities.
