Heading into Friday’s Non Farm Payrolls (NFP) report for September, economists are expecting an increase in payrolls of 80K, which would be a huge 76K decline from last month’s weaker than expected reading of 156K.  In the private sector, economists are expecting an even larger decline to 72K from 165K.  Even with the slower job growth, the unemployment rate is forecasted to remain at an exceptionally low level of 4.4%.  Growth in average hourly earnings is expected to accelerate to 0.3%, while average weekly hours worked is also forecast to remain unchanged at 34.4.  While the job creation figures are forecasted to show a major slowdown, it is all due to the hurricanes that hit the south during late August and early September.

Ahead of the report, we just published our eleven-page monthly preview for the September jobs report.  This report contains a ton of analysis related to how the equity market has historically reacted to the monthly jobs report, as well as how secondary employment-related indicators we track looked in August.  We also include a breakdown of how the initial reading for August typically comes in relative to expectations and how that ranks versus other months.

One topic we cover in each month’s report is the S&P 500 stocks that do best and worst from the open to close on the day of the employment report based on whether or not the report comes in stronger or weaker than expected. In other words, which stocks should you buy, and which should you avoid?  The table below highlights the best-performing stocks in the S&P 500 from the open to close on days when the Non-Farm Payrolls report has been better than expected over the last two years. Of the 25 top performing stocks on days when the NFP beats expectations, six sectors are represented, with Energy leading the way with seven.  Leading the way to the upside, both Vornado (VNO) and Qorvo (QRVO) have seen average open to close gains of over 2%.  In terms of consistency, Urban Outfitters (URBN), Skyworks (SWKS), Autodesk (ADSK), and Albermarle (ALB) have been in the black 92% of the time.

For anyone with more than a passing interest in how equities are impacted by economic data, this report is a must-read.  To see the report, sign up for a monthly Bespoke Premium membership now!

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