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By Jason Stipp | 12-09-2011 12:00 PM

Smooth Sailing or Stormy Seas?

Morningstar markets editor Jeremy Glaser examines what the week's headlines suggest about employment, China, autos, and more.

Jason Stipp: I'm Jason Stipp for Morningstar, and welcome to the Friday Five.

Clear sailing or stormy seas? Morningstar markets editor Jeremy Glaser is joining me this week with five things from the market that could bode well or poorly for corporations and the economy.

Thanks for joining me, Jeremy.

Jeremy Glaser: You're welcome, Jason.

Stipp: So, what do you have for the Friday Five this week?

Glaser: Well, we're going to talk about jobs, J.C. Penney, Yum Brands, Ford, and finally, Research In Motion.

Stipp: So, on Thursday we got pretty decent initial claims data that seems to indicate the job market might still be on a pretty good footing, hopefully, heading forward. What do you say about that data?

Glaser: We are actually getting a lot of encouraging jobs data, which had been a little bit disconcerting after just so much bad jobs data for so long, but it really does look like the economy is truly adding jobs now. We saw this in the unemployment report just a few weeks ago; we saw it in the initial jobless claims, continuing to track down, continuing claims continuing to track down, and we see it in other data. McDonald's, when they released their comparable same-store sales, they said that North America looked pretty strong because of seasonal items, but also because of breakfast, and breakfast at McDonald's is a great indicator for employment, because, really, only people with jobs are stopping at McDonald's for breakfast. I, for one, know that if I didn't have a job in the morning, I probably wouldn't be waking up quite that early and getting out to McDonald's for that Egg McMuffin. So, I think certainly that's another sign that people are really getting back to work, and I think that could bode well for the economy looking forward.

Stipp: In corporate news, Martha Stewart Omnimedia had a pop this week because of a deal with J.C. Penney. Does this mean better sales going ahead for them?

Glaser: I think J.C. Penney is going to be an interesting story to watch. They've seen a lot of trouble in their home business, and they're hoping that bringing in Martha Stewart, bringing in her brand, and really carving out niches in the store where people can buy those Martha Stewart goods, is really going to help them recapture some market share in that area.

This is one of the initiatives that their new chief executive Ron Johnson is really championing. He came over from the Apple stores, he was incredibly successful there, and I think we're all waiting to see exactly what he's going to do in J.C. Penney to really turn that business around and really get it up to snuff with some of their other peers.

I think this is just the first step, but I think it shows that he's willing to think maybe a little bit out-of-the-box to really build deep partnerships with brands that he thinks are going to be valuable in order to get J.C. Penney truly back on track.

Stipp: A possible slowdown in China has a lot of folks worried about rough seas coming ahead for the global economy. Yum Brands has a lot of business in China. We heard from them recently. What do they have to say on the story?

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