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After three up days, the markets sold off.  The markets weren’t too crazy about today’s great jobs data.  Strange.  But this also described yesterday’s trading activity.First, the scoreboard:

Dow: 12,359.9, -55.8, -0.5%
S&P 500: 1,277.8, -3.3, -0.3%
NASDAQ: 2,674.2, +4.4, 0.2%

And now, the top stories:

  • Europe didn’t get any better this morning.  European retail sales fell 0.7% in November.  German factory orders plunged 4.8% in November, which was much worse than the 1.8% decline expected.  This is concerning since Germany, the largest economy in Europe, is also considered to be in the best economic shape in the eurozone.  Also, Fitch joined its counterparts–S&P and Moody’s–in downgrading Hungary to junk status.  European markets actually closed mostly higher, but the euro extended its epic plunge.
  • The always anticipated monthly jobs number blew away expectations.  At least the headline numbers did.  In December, companies added 200k nonfarm payrolls, and the unemployment rate fell to 8.5%.  This compares to economists’ expectation of 155k and 8.7%, respectively. These figures are much better than the 10.3% unemployment rate across the euroarea, which includes a 22.9% unemployment rate in Spain.
  • So, the jobs numbers were great numbers, right?  Well, U.S. futures spiked on the report. but once markets opened, stocks sold off.  Pundits scrambling for answers dug into the data and pointed out that hiring in the “couriers and messenging” category was up significantly.  In other words, December jobs were driven by the holiday hiring at companies like FedEx and UPS.
  • Financials lagged today.  Yesterday, the White House denied rumours of a refinancing plan.  Analysts from Wells Fargo, JP Morgan, Bernstein, Meredith Whitney Advisory Group, and Ticonderoga slashed their forecasts for the big investment banks including Goldman Sachs and Morgan Stanley.  Concerns include lower trading volumes and the unfavorable impact of the eurozone debt crisis.  Here Are The Best And Worst Stock Pickers On Wall Street >
  • aluminium giant Alcoa announced it would be slashing its global smelting capacity by 12%.  The stock fell today.  The economic bellwether kicks off earnings season on Monday.
  • A couple of big retail names made major moves today.  Family Dollar fell 7.5% today, despite announcing healthy revenue and comparable store sales growth.  However, promotional pricing is putting the squeeze on margins.  On the other hand, Best Buy shares rallied, despite announcing a 1.2% decline in same-store sales.
  • Don’t Miss: The Best And Worst Stock Pickers On Wall Street >

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