At Friday’s opening bell, stocks were trading higher, following the December report on nonfarm payrolls. In the first 30 minutes of trading, the Nasdaq was up 0.38%, the S&P 500 by 0.66% and the Dow by 0.75%.
The job gains in the December report were higher than expected (223,000 versus 210,000), and the headline unemployment rate fell from 3.6% to 3.5% instead of rising to 3.7%. All of that would indicate further Federal Reserve tightening and falling equity prices.
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But wait, there’s more. Hourly earnings rose less than expected (0.3% vs 0.4%), and the average workweek declined from 34.4 hours to 34.3 hours. These numbers imply that productivity is rising, a good thing, and a reason to expect Fed rate increases to moderate, perhaps as soon as the January 31 meeting.
No notable earnings reports were released Friday morning. They will be scarce until Friday, January 13, when several of the largest U.S. banks and financial services firms, one airline, and one Dow Jones industrial average health care company report quarterly results.
Here is a preview of what to expect when the following two companies report quarterly results before markets open on Tuesday.
Albertsons
In mid-October, Albertsons Companies Inc. (NYSE: ACI) and Kroger announced that they would merge after Kroger acquired all the outstanding shares of Albertsons stock and Albertson’s paid a special dividend of some $4 billion to shareholders.
The special dividend, originally expected to be paid on November 7, remains an open question. The state of Washington Supreme Court has blocked the payment but earlier this week set a January 17 date to hear the company’s request to lift the temporary restraining order so that Albertsons can meet its rescheduled special dividend payment on February 9. Nearly 40% of the payout would go to two asset management firms, Cerberus, which owns about 28.4% of Albertsons stock, and Lubert-Adler, owner of nearly 11% of the stock.
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