Stocks Edge Higher on Low Volume
Stocks in the US consolidated on the open as volume was soft as many are celebrating the Veteran’s day holiday. The bond market in the US is closed along with banks and government agencies. Friday’s stronger than expected employment report generated significant upside volatility which saw the Dow Industrials notch up a new all-time high on Friday. With a very light economic calendar this week, equity momentum is likely to remain positive.
On Friday, the Department of Labor released better than expected non-farm payrolls, but the household survey showed a contraction in the labor force. According to the Bureau of Labor Statistics, non-farm payrolls climbed 204,000 compared to the 120K expected by economists. The BLS made positive revisions to September and October generating a 3-month average of more than 200K jobs per month.
The household survey report showed that the unemployment rate ticked up to 7.3% from 7.2% while the participation rate declined to 62.8% from 63.2% the lowest in the past 30 years. The household survey showed that job losses outpaced job gains by nearly 400K jobs, which was in contrast to the corporate release.
In corporate news, Novartis (NYSE:NVS) announced that it plans to sell diagnostics ops for $1.675 billion. Novartis has agreed to sell its blood-transfusion diagnostics unit to Spanish healthcare company Grifols for $1.675 billion in a move that is part of the Swiss pharmaceuticals group’s plan of selling smaller units in order to focus more sharply on our strategic businesses.
Shares of Facebook (NASDAQ:FB) were down 2.2%, under pressure on news that Director Marc Andreesen’s firm Andreesen Horowitz sold approximately 2.28 million shares. The sale took place on November 6, according to SEC filings. Andreesen now owns 4.5 million shares.
FB sliced through short term support and could continue to move lower testing target support near 42.50. Momentum is negative with the MACD printing in the red with a downward trajectory.
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