B.I.G. Tips – May Employment Report Preview
Heading into Friday’s Non-Farm Payrolls (NFP) report for May, economists are expecting an increase in payrolls of 190K, which would be a big improvement from April’s reading of 164K. In the private sector, economists are also expecting a similar increase of 190K. With these increases, the unemployment rate is expected to remain low at 3.9%. The big area of focus, however, will come from average hourly earnings. With so much concern around inflation, any stronger than expected reading in wage measures will likely be viewed as a negative for the market.
Ahead of the report, we just published our eleven-page preview of the May 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 May. We also include a breakdown of how the initial reading for May 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, eight sectors are represented, and Consumer Discretionary leads the way with nine. Vornado (VNO) has been the best performing stock with an average open to close gain of 2.86%. In terms of consistency, CH Robinson (CHRW) has been up every time, while another six stocks have been positive nine out of ten times.
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!
B.I.G. Tips — June 2018 Seasonality
This content is for members onlyB.I.G. Tips – Decile Analysis Since 4/2/18
This content is for members onlyB.I.G. Tips – Cramming For Midterms
With the midterm Congressional elections less than six months away, polling data is sure to start making its presence felt on the market. To help navigate through all of the noise and to prepare yourself for what to expect, we have just published a report on historical trends in control of Congress and market performance during mid-term election years. If you are already a member, please log-in here to view the report. If you’re not yet a Premium subscriber and would like to see the report, please start a two-week free trial to Bespoke Premium now. Here’s a breakdown of the products you’ll receive.
B.I.G. Tips – Philly Fed Feeling Fine
As mentioned in a post earlier today, today’s headline reading in the Philadelphia Fed Manufacturing report came in stronger than expected and registered its 18th straight reading above +20 in the history of the survey. While the current streak of +20 readings is unprecedented, there have been two other periods in the history of the survey (dating back to 1980) where it was above +10 for at least a year and a half (18 months). In a just-published B.I.G. Tips report for Bespoke Premium and Bespoke Institutional clients, we analyzed the S&P 500’s performance during each of those periods to see if there were any parallels to today.
From a more shorter-term perspective, we also looked at how a key internal breadth indicator of the S&P 500 is currently at a critical juncture which could go a long way in determining the future path of the market.
If you are already a member, please log-in here to view the report. If you’re not yet a Premium subscriber and would like to see the report, please start a two-week free trial to Bespoke Premium now. Here’s a breakdown of the products you’ll receive.
