Investing
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Today’s Bureau of Labor Statistics data contradict Wednesday’s ADP report of a shrinking U.S. workforce. Nonfarm payrolls grew 147,000 in June.
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On a more “micro” economics level, though, Microsoft just announced 9,000 more job cuts.
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The Vanguard S&P 500 ETF closed along with the rest of the market, three hours early on Thursday — which was still plenty of time for the ETF to rise 0.9% to 575.22. Markets will be closed for Independence Day on Friday.
Contradicting HSBC’s move earlier in the day, Goldman Sachs has raised its price target on Tesla stock to $315. The banker is keeping only a neutral rating on the stock, but still sounds optimistic: Q2 vehicle deliveries totaled 384,000, which was up 14% quarter-over-quarter (if down 13% year-over-year), and “meaningfully better” than the 365,000 units Goldman had expected Tesla to report.
Citigroup raised its price target on S&P 500 component company DuPont (NYSE: DD) to $85 with a buy rating, and named DuPont its “top pick” in North America specialty chemicals. Citi predicts “another strong performance” from DuPont in Q2 and says tariff impacts will be limited.
DuPont stock is up 0.9% on the news. The Voo is up 0.8%.
S&P 500 component company Tesla (Nasdaq: TSLA) had an “exceptional” month of June, with 170,000 or 180,000 vehicles sold, says HSBC — but the banker finds this number “difficult to explain.” Car buyers front-running the new tax bill that could eliminate income tax credits for EV purchases could be one catalyst. In any case, HSBC insists the June result is “an aberration,” and maintains a reduce rating and a $120 price target on Tesla stock.
Regardless, Tesla shares are up 0.5% this morning, and the Voo is up 0.4%.
This article will be updated throughout the day, so check back often for more daily updates.
Point… counterpoint. In apparent contradiction of a report from HR specialist Automatic Data Processing (Nasdaq: ADP) yesterday, which said private employers reduced jobs in America by 33,000 last month, the U.S. Bureau of Labor Statistics just reported that total nonfarm payrolls in the U.S. grew by 147,000 in June, and the unemployment rate dropped 20 basis points to 4.1%. Not only do the BLS numbers show jobs growing where the ADP number showed jobs slowing. The BLS number was also stronger than economists’ predicted 110,000 jobs grown in June.
So is U.S. unemployment increasing or decreasing? I guess it really depends on which data you believe.
One place where employment is most definitely falling, though, is Microsoft (Nasdaq: MSFT), which announced last night that it will lay off 9,000 more employees, on top of roughly 2,000 workers laid off in January, a further 6,000 in May, and 300 more last month. In total, the company appears on track to shed about 17,000 workers this year, or roughly 7.5% of its workforce from this time, last year. The company explained in a statement that it is making “organizational changes necessary to best position the company and teams for success in a dynamic marketplace.”
As investors attempt to digest all this news, the Vanguard S&P 500 ETF (NYSEMKT: VOO) is trading up 0.2% pre-market.
Analyst Calls
French bank BNP Paribas is celebrating U.S. independence day 24 hours early, upgrading shares of S&P 500 components FedEx (NYSE: FDX) and UPS (NYSE: UPS), to outperform and neutral, respectively.
Previously negative on both stocks, the FedEx change is biggest as BNP calls the stock “oversold,” flips from underperform to outperform, and raises its price target to $270 a share. FedEx is outperforming on both volume and yield growth (efficiency), says the analyst. UPS isn’t quite as attractive, but earnings estimates now look more realistic and volume headwinds appear priced into the stock, justifying a neutral rating.
In other news, Needham & Co. upgraded S&P 500 component Meta (NYSE: META) to hold. Although arguably pricey, Needham sees a lot to like in Meta stock, which is “globally scaled, doesn’t pay for content, is software only, ‘free-rides’ on mobile devices, and has closed loop attribution for advertisers.”
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