Thursday, February 6, 2025

Another eventful morning for the stock market: not only do we continue into the heart of Q4 earnings season, but today is Thursday, so generally the morning we see Weekly Jobless Claims. A quarterly Productivity report joins the fray this morning… yet somehow the market indexes are little changed: lightly higher across the board.

Jobless Claims Continue Depicting a Healthy Labor Market

Last week, +219K Initial Jobless Claims were made — higher than the slightly upwardly revised +208K the previous week, but well off the outlier +260K we saw in early October of 2024. In fact, since mid-December, we’ve seen a lower trend overall in new jobless claims, averaging +214K per month over the last six months; +223K over the prior six months.

Continuing Jobless Claims cranked up slightly to +1.886 million two weeks ago (longer-term claims report a week in arrears from new claims), which is up from the slightly downwardly revised +1.85 million the previous week. We saw 1.9 million — a psychologically important level — a couple weeks back, but really what analysts remain concerned with is 2 million longer-term jobless claims per week, which we haven’t seen since November of 2001, when we were finally unravelling the Covid-era hit to the economy.

Q4 Productivity Lower than Anticipated

At +1.2%, U.S. Productivity came in 20 basis points (bps) below estimates, and a full 100 bps from the previous quarter. This is the weakest we’ve seen productivity since Q1 2024, when we only reached +0.3%. Unit Labor Costs came in at +3.0% year over year — below the +3.3% anticipated, but much higher than the previous quarter’s +0.8%.

Q4 Earnings Beats from LLY, COP

Earnings season continues to present favorable upward surprises, starting with Big Pharma staple Eli Lilly LLY: earnings of $5.32 per share easily outpaced the $5.03 expected, for a +5.77% beat. Revenues of $13.53 billion outperformed estimates by +0.44%, well above the $9.35 billion reported in the year-ago quarter. Yet shares are selling the news by -1.2% at this hour, following a +9% run-up in the stock year to date. For more on LLY’s earnings, click here.

Check out the updated Zacks Earnings Calendar here.

ConocoPhillips COP also beat expectations this morning, with earnings of $1.98 per share surpassing estimates by 8 cents (though still below the $2.40 per share reported in the year-ago quarter), for a +4.2% positive surprise. Revenues of $14.74 billion outpaced expectations by +1.82%, lower than the $15.31 billion reported a year ago. Shares are selling slightly in the pre-market on careful oil price valuations. For more on COP’s earnings, click here.

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