Market Happenings for Thursday, May 31, 2012

Premarket, futures are up. Gainers this morning include SPLS, DLTR, PCS, JDSU and ALTR while losers include JOY, KSS, FFIV and JWN.

The Market

A report on private sector hiring from payroll services firm ADP showed a gain of 133,000 jobs, less than the 157,000 gain forecast by economists. Also, the number of people filing for first-time unemployment benefits in the U.S. rose 10,000 to 383,000 in the latest week, which was higher than the 368,000 expected by analysts.

Investors are still worried about Spain not being able to fund bank bailouts that could reach as much as €100 billion. Yields on 10-year Spanish debt soared to 6.6% Wednesday, but retreated slightly in Thursday morning trade.

European stocks were all higher in morning trade and Asian markets closed slightly lower.

The jobs report is due Friday. Analysts expect that the U.S. economy added 150,000 jobs in May, including 12,000 government cuts. The unemployment rate is expected to stay at 8.1%.

Earnings Reports

Earnings reports (sorted by mkt cap): JOY-Joy Global (consensus $1.96), SAI-SAIC (0.33), ASNA-Ascena Retail (0.36), ESL-Esterline Tech (1.28), JOSB-Jos A Bank (0.79).

Financial Calendar

0730 ET May Challenger job cuts, Apr 11.2%.

0800 ET Fed’s Pianalto speaks on monetary policy in Cleveland.

0815 ET May ADP employment expected +150,000, Apr +119,000.
n/a May ICSC chain store sales, Apr +0.6% y/y.

0830 ET Weekly initial unemployment claims expected unchanged at 370,000, previous -2,000 to 370,000. Weekly continuing claims expected -10,000 to 3.250 mln, previous -29,000 to 3.260 mln.

0830 ET Q1 GDP expected revised to +1.9% from +2.2%. Q1 personal consumption unrevised at +2.9%. Q1 GDP price index expected unrevised at 1.5%. Q1 core PCE, last +2.1%.

0830 ET USDA weekly exports.

0945 ET May Chicago Purchasing Managers index expected +0.7 to 56.9, Apr -6.0 to 56.2.

1000 ET May Milwaukee NAPM index expected +0.5 to 53.4, Apr 52.9.

1030 ET DOE Weekly Petroleum Status Report (postponed one day due to Monday’s holiday).

1030 ET DOE natural gas storage.

1630 ET Weekly money supply report and Fed balance sheet.

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