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Midday Market Update

Stocks Higher After Jobs, Manufacturing Data

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U.S. Market
Stocks were higher this morning after a mostly in line jobs report and encouraging manufacturing data.

The U.S. economy added 157,000 jobs in January, while the unemployment rate ticked up to 7.9%. Although January was slightly below expectations, payroll numbers for 2012 were revised upwards. The Labor Department now says that the economy added 181,000 a month last year, higher than the originally reported 153,000 reading. Average earnings were up 4 cents to $23.78 an hour while the average workweek was unchanged.

The closely watched ISM manufacturing index expanded to 53.1 in January from 50.2 in December. Economists had expected a much more modest increase.  Any reading over 50 indicates an expansion in the manufacturing sector.

At midday the Dow and Nasdaq were each up 1.0% while the S&P 500 was 0.9% higher.

Stocks on the Move
Merck (MRK) reported fourth-quarter results that  slightly exceeded expectations, partly based on strong vaccine sales.  Total sales fell 3% operationally versus the prior year period as generic Singulair competition weighed on the results. Also, earnings per share fell 14% year over year as the loss of the high-margin contribution from Singulair had an amplified impact on the bottom line. Shares were down 2.7% at midday.

 Exxon Mobil (XOM) reported a better-than-expected 5.9% increase in quarterly earnings this morning. The firm saw a decline in oil and gas production in the quarter, but was able to make up for it with strong earnings from its refining and chemical units. Shares were little changed at midday.

 National Oilwell Varco (NOV) turned in  strong fourth-quarter results. Revenue increased 7% sequentially to $5.69 billion, led by the rig technology segment. Operating profit increased slightly over the same time frame to $954 million, but the overall operating margin dipped 100 basis points sequentially to 16.8%. Shares fell 4.5% on the report.

Foreign Markets
European shares moved higher after some positive economic data in both the U.S. and the eurozone. In late trading, the FTSE 100 and Paris CAC were each up 1.1% while Germany’s DAX was 0.7% higher.

Asian markets were also mostly higher on the day. The Shanghai Composite was up 1.4%, the Nikkei 225 was 0.5% higher while the Hang Seng was flat.

Jeremy Glaser does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.