The Daily Dose: Does Jobs Day Matter?

 | Aug 01, 2014 | 12:00 PM EDT  | Comments
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Nonfarm payrolls missed consensus. That is the last thing the market needs to hear as it tries to recover from Thursday's brutal selloff that everyone saw coming.

Depending on who you ask, jobs day is crazy important or a waste of time. To me, jobs day is still crazy important as a good deal of my coverage area --the consumer -- trades on employment figures (among zillions of other factors). But given no change in Fed policy probably until Janet Yellen speaks at Jackson Hole shortly (her recent comments on overvalued asset prices suggest the Jackson Hole speech could be uncharacteristically hawkish), jobs day is just another one in which the market opens and Twitter explodes with pundit commentary and charts.

I think to really invest properly you have to take an analysis of the employment market to the most micro of levels, somewhat putting today's miss in the rearview mirror. Take for example what I did yesterday using the Bloomberg terminal on the Las Vegas employment market. Gambling revenues in Las Vegas are starting to recover nicely. The state of affairs is so far removed from the bust that is Atlantic City. Nonfarm payrolls in Las Vegas have increased sequentially in four of the past five months. In turn, casino operators are being able to pass along room rate increases and bask in the financial benefits of new dining and entertainment experience options. If you look at the year-to-date stock performance of this particular sector, it's dreadful. There may be an opportunity there in a name or two.

Three More Things on Whole Foods

Read this earnings call three times. I am straight crushing on the release because Whole Foods (WFM) is a best-in-class operator with the second-worst-performing stock in the S&P 500 this year. There has to be an opportunity for long-term patient investors, but not right now. Here are a three things to keep in mind.

  1. Ten quarters in a row where retail prices increases have been less than cost increases (not good).
  2. Over the next year, the company will refresh about 200 stores, adding zones (juice bars) or just making the environment more visually appealing. New remodels are receiving a nice boost in same-store sales.
  3. Save the date. The company will announce a home delivery deal on Sept. 1, which may excite some investors.

Keep an Eye On

Symantec (SYMC) has climbed about 5% in the past months. Earnings are next week. I interviewed the chief operating officer last week, so the entire story is fresh in my mind. I'm not expecting a blowout quarter, but not sure if the market even expects much.

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