Stocks began the day sharply lower following disappointing data from both the U.S. and China. China said that exports fell more than 20% last month due to trade concerns while the U.S. jobs report showed a shockingly lower than expected number of jobs were created last month. The averages cut their losses in the early going, but have weakened again near midday. Meanwhile, oil prices are down about 3% to slide back near $55 a barrel.
ECONOMIC EVENTS: In the U.S., nonfarm payrolls increased a mere 20,000 in February, which was much weaker than the roughly 180,000 forecast. However, the unemployment rate fell to 3.8% from 4.0% previously and average hourly earnings rose 0.4%, which marked the best gain in almost 10 years. Housing starts bounced 18.6% to a 1.23M rate in January following a 14.0% drop to a 1.04M rate in December.
In China, exports plunged 20.7% year-over-year in February, which was well off the median forecast for a comparatively moderate drop of 4.8%. In addition, a rare "sell" rating from China's largest brokerage was taken as a sign that the government wants to limit gains on equity markets.
TOP NEWS: Shares of Costco (COST) rose 5% after the retailer reported better than expected earnings for the second quarter, with total comparable sales up 6.7% on an adjusted basis year-over-year. Of note, the company said on its Q2 conference call that it is raising its minimum wage for its employees from $14 and $14.50 to $15 and $15.50 per hour in both the U.S. and Canada.
Meanwhile, Netflix (NFLX) shares were 2% lower after Buckingham analyst Matthew Harrigan downgraded the stock to Neutral from Buy, citing the stock's sensitivity to any market pullback, "investor angst" regarding what he refers to as "increasingly credible" competition from the Disney+ (DIS) streaming service and his concerns that his model for Netflix's long-term global membership growth may be optimistic given the mounting competition. Harrigan maintained a $382 price target on the shares.
MAJOR MOVERS: Among the noteworthy gainers was Tandem Diabetes (TNDM), which rose 2% after BMO Capital initiated coverage of the stock with an Outperform rating. Also higher were Upland Software (UPLD) and Big Lots (BIG), which gained a respective 16% and 14% after reporting quarterly results.
Among the notable losers was Tilray (TLRY), which slid in early trading after Jefferies initiated coverage of the stock with an Underperform rating. However, Tilray shares have recovered to be down only fractionally near noon. Also lower were Eventbrite (EB) and National Beverage (FIZZ), which fell 22% and 17%, respectively, after reporting quarterly results.
INDEXES: Near midday, the Dow was down 149.36, or 0.59%, to 25,323.87 , the Nasdaq was down 57.99, or 0.78%, to 7,363.48 , and the S&P 500 was down 21.03(-0.77%, to 2,727.90 .
