Stocks had a strong finish to the week, with the Nasdaq leading the way higher, as the market seemed to view the monthly jobs report with a "bad news is good news" lens. The broadening recovery, the "no time to taper" Fed and expectations that more federal spending is on the way continue to make the case for bulls, who may be reading the lackluster April jobs report as further fuel for both central bankers and lawmakers to keep up with their accommodations.
ECONOMIC EVENTS: In the U.S., nonfarm payrolls rose 266,000 in April, which was a huge miss compared to the consensus forecast for nearly 1M job additions. The unemployment rate edged up to 6.1% from 6.0% last month and there was a downward revision in March to 770,000 payroll additions from the prior estimate of 916,000 jobs having been added. The wholesale trade report beat estimates with a 4.6% March sales surge as inventories also slightly beat the advance figures with a 1.3% rise. In energy news, Baker Hughes reported that the U.S. rig count is up 8 from last week to 448 with oil rigs up 2 to 344.
TOP NEWS: Square (SQ) rose 4.2% after the company posted what JPMorgan analyst Tien-tsin Huang called an "impressive acceleration" in both Seller and Cash App in Q1. Meanwhile, Morgan Stanley analyst James Faucette said Square's "robust" engagement metrics "keep the Super App ambitions within reach."
Shares of Peloton (PTON) closed fractionally higher after the company's earnings report last night. JPMorgan analyst Doug Anmuth lowered the firm's price target on Peloton to $140 from $200, but said he came away from the company's Q1 earnings "incrementally positive." The U.S. launch of the Tread is likely pushed only a few months and it enables Peloton to build more inventory and launch in a seasonally stronger part of the year, Anmuth added as he keeps an Overweight rating on the shares.
Roku (ROKU) shares were 11.6% higher after what Loop Capital analyst Alan Gould said was the company's "strongest quarter reported" since going public. Gould upgraded Roku to Buy from Hold with an unchanged $450 price target following the Q1 update, while Benchmark analyst Daniel Kurnos keeps a Buy rating on the shares after the company's "massive quarter," which he said "far exceeded consensus expectations on every metric except, perhaps, a slight miss in active account growth."
DraftKings (DKNG) shares fell 6.7% despite the online betting company reporting a Q1 revenue beat that Morgan Stanley analyst Thomas Allen said was "very impressive." DraftKings raised its 2021 revenue view to $1.05B-$1.15B from $900M-$1B, citing what it said was "solid performance in the first quarter of 2021," as well as "continued strong user activation due to the effectiveness of our marketing spend, well-executed launches of mobile sports betting and iGaming in Michigan and mobile sports betting in Virginia, and a modest contribution from our recently completed acquisitions."
In other earnings news, Monster Beverage (MNST) shares slid 4% following the energy drink maker's report, while Beyond Meat (BYND) fell 7% following earnings from the alternative meat maker.
In COVID news, Pfizer (PFE) chairman and CEO Albert Bourla said in an open letter that the suggested waiver of intellectual property rights for COVID-19 vaccines in the U.S. "could only derail progress." "Is the proposed waiver going to improve the supply situation or create more problems? [My] answer is categorically the latter," he added. U.S. Trade Representative Katherine Tai said earlier this week that U.S. will support a proposal for the waiver. "We are for the waiver at the WTO, we are for what the proponents of the waiver are trying to accomplish, which is better access, more manufacturing capability, more shots in arms," Tai said in an interview with Bloomberg.
MAJOR MOVERS: Among the noteworthy gainers was iBio (IBIO), which rose 17.5% after providing an update on its IBIO-201 program designed to prevent SARS-CoV-2 infection. Also higher were Qurate Retail (QRTEA), Datadog (DDOG), and GoPro (GPRO) which gained a respective 15.9%, 8.3%, and 3.5% after reporting quarterly results.
Among the notable losers was ChemoCentryx (CCXI), which plunged 62% after the FDA Arthritis Advisory Committee on avacopan for the treatment of Antineutrophil Cytoplasmic Autoantibody vote split 9-9 on the question of whether the efficacy data support approval of avacopan for the treatment of adult patients with AAV. Also lower were Ocugen (OCGN), Aurinia Pharmaceuticals (AUPH), Teradata (TDC) which fell a respective 4.1%, 17.8%, and 16.3% after reporting quarterly results.
INDEXES: The Dow rose 229.23, or 0.66%, to 34,777.76, the Nasdaq gained 119.39, or 0.88%, to 13,752.24, and the S&P 500 advanced 30.98, or 0.74%, to 4,232.60.
