Trader Talk

Parsing the Jobs Blowout

Peter Dazeley | Photographer's Choice | Getty Images

jump 10 points on January nonfarm payroll blowout: 243,000, nearly twice estimates. Everything was better: private payrolls, unemployment rate, average workweek, even November and December numbers were revised higher.

The stock futures jumped, but skeptics immediately came out: A third round of quantitative easing (QE3) from the Federal Reserve now is less likely, so many are positioning to play a late-day fade. “Sell bonds” is heard everywhere.

Maybe. But would you take a stronger economy over QE3? And a little stronger dollar? I don't know anyone who wouldn't.


1) Greek debt deal imminent! Greek debt deal imminent! Greek debt deal...oh, shut up.

How close are we? The euro-zone finance minister meeting scheduled for Monday may be postponed, because a private sector debt deal still hasn't been struck.

2) The old party politics starts again in Italy: It doesn't sound like much, but Italian Prime Minister Mario Monti lost a vote in the Italian chamber of deputies. The chamber voted 264 to 211 to pass an amendment making it possible to bring civil lawsuits personally against magistrates for trial errors. Sounds obscure, but it was revenge by supporters of ousted Prime Minister Silvio Berlusconi supporters, who felt the Italian magistrates had hounded Berlusconi with investigations for years (they did, with good reason).

Regardless: It's a sign that Monti is already having trouble holding the coalition together. And Berlusconi? We finally heard from him: “It would be irresponsible not to continue to support this government,” he said.

3) Good start to February in Europe: European shares rallied on U.S. jobs data and a purchasing manager’s survey that showed the euro zone’s private sector in December grew for the first time in four months.

Germany’s DAX and the U.K.’s FTSE rallied to a six-month high as PMI data hinted the euro zone may avoid dipping back into recession . All major indices are on pace to finish the week in positive territory.

This Week:

Germany +3.6%
Greece +3.3%
France +2.5%
Italy +2.5%
UK +2.2%
Spain +1.8%

4) Simon Property Group reports fourth-quarter funds from operations (FFO) increased 6.3 percent to $1.91 a share, beating the Street’s estimates, as higher occupancy and sales at its tenants’ stores boosted quarterly earnings. The mall owner raised its quarterly dividend to $0.95 per shares from $0.90 and now has a 2.6 percent dividend yield. They did provide 2012 FFO guidance of $7.20-$7.30, about in-line with analyst estimates.

Occupancy was 94.8 percent, up from 94.2 percent in the same period last year. And despite all the talk about online shopping, sales are doing better: Tenant sales in the consolidated portfolio were $518 per square foot, 7 percent above the same period last year.

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