Why U.S. Stocks Are Trading Lower Despite Upbeat Nonfarm Payrolls Report

U.S. stocks traded lower this morning following the release of jobs report for the month of June.

Following the market opening Friday, the Dow traded down 0.40% to 31,259.22 while the NASDAQ fell 0.92% to 11,514.48. The S&P also fell, dropping, 0.65% to 3,877.42.

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Leading and Lagging Sectors

Health care shares rose by 0.4% on Friday. Meanwhile, top gainers in the sector included MyMD Pharmaceuticals, Inc. MYMD, up 20% and iRhythm Technologies, Inc. IRTC up 22%.

In trading on Friday, materials shares dipped by 1.2%.

Top Headline

The US economy added 372,000 payrolls in June, following a revised 384,000 growth in May. Analysts, however, were expecting for a 268,000 gain in jobs. Average hourly earnings for all employees on private nonfarm payrolls increased 0.3% to $32.08 in June. The US unemployment rate came in unchanged at 3.6% in June.

Equities Trading UP

Seritage Growth Properties SRG shares shot up 52% to $9.24 after the company appointed Adam Metz as Chairman. Preliminary proxy materials also indicated the board recommended shareholders to approve a proposed plan sale.

Shares of Clovis Oncology, Inc. CLVS got a boost, shooting 36% to $2.95. Clovis Oncology said on July 1, it had a Type A meeting with the FDA.

iRhythm Technologies, Inc. IRTC shares were also up, gaining 22% to $140.10 after the company provided comment on the recently released Centers for Medicare and Medicaid Services Medicare Physician Fee Schedule Proposed Rule for Calendar Year 2023.

Equities Trading DOWN

Upstart Holdings, Inc. UPST shares tumbled 21% to $26.66 after the company cut preliminary Q2 revenue outlook. Additionally, JMP Securities downgraded the stock from Market Outperform to Market Perform.

Shares of WD-40 Company WDFC were down 13% to $177.99 after the company reported worse-than-expected Q3 EPS and sales results.

iHeartMedia, Inc. IHRT was down, falling 9% to $6.72. Wells Fargo downgraded iHeartMedia from Overweight to Equal-Weight and lowered the price target from $23 to $9.

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Commodities

In commodity news, oil traded up 0.2% to $102.96, while gold traded down 0.2% to $ 1,736.90.

Silver traded down 0.4% to $19.115 on Friday while copper fell 1.5% to $3.5175.

Euro zone

European shares were mostly lower today. The eurozone’s STOXX 600 fell 0.2%, London’s FTSE 100 fell 0.4% while Spain’s IBEX 35 Index fell 0.8%. The German DAX gained 0.5%, French CAC 40 fell 0.3% and Italy’s FTSE MIB Index gained 0.3%.

Italy’s industrial production fell 1.1% from a month ago in May versus a revised 1.4% growth in the April. France recorded a current account deficit of EUR 3.9 billion in May versus a revised EUR 2.7 billion gap in the prior month, while trade deficit increased to EUR 13 billion in May from a revised EUR 12.7 billion in the previous month.

Economics

The US economy added 372,000 payrolls in June, following a revised 384,000 growth in May. Analysts, however, were expecting for a 268,000 gain in jobs. Average hourly earnings for all employees on private nonfarm payrolls increased 0.3% to $32.08 in June. The US unemployment rate came in unchanged at 3.6% in June.

Wholesale inventories in the US rose by 1.8% from a month ago to $878.6 billion in May.

New York Fed President John Williams will speak at 11:00 a.m. ET.

The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.

Data on consumer credit for May will be released at 3:00 p.m. ET.

Check out this: U.S. Jobs Growth Might Slow To This Level In June, Here's The Major Macro Issues For Friday

COVID-19 Update

The U.S. has the highest number of coronavirus cases and deaths in the world, reporting a total of 90,065,160 cases with around 1,045,080 deaths. India confirmed a total of at least 43,587,300 cases and 525,340 deaths, while Brazil reported over 32,761,040 COVID-19 cases with 673,120 deaths. In total, there were at least 558,810,440 cases of COVID-19 worldwide with more than 6,369,440 deaths.