Buyers pushed small caps and tech stocks higher in the stock market today after the November jobs report didn't reveal any big surprises. Gains were milder in the Dow Jones Industrial Average and S&P 500.
Early gainers in the Dow Jones included Home Depot (HD), up more than 1%, while Lululemon (LULU) was a top gainer in the Nasdaq 100. Home Depot is still in a buy zone after clearing a 421.56 entry.
The Russell 2000 small-cap index and Nasdaq composite took the early lead, both up around 0.7%, while the Dow Jones industrials and S&P 500 edged higher by 0.2% to 0.3%.
↑ XStock market breadth was strong, with winners beating losers on the Nasdaq and NYSE by about 2-to-1.
Tesla (TSLA) rallied another 1%, one day after BofA Securities lifted Tesla's price target to 400 from 350, while keeping a buy rating. Tesla is less than 10% from its early November 2021 all-time high of 414.50.
Sentiment was generally positive in the stock market today on news the economy created 227,000 jobs in November, a little better than the 200,000 consensus forecast. The unemployment rate ticked higher to 4.2% from 4.1%, while the labor force participation rate edged lower. The latest job growth was much higher than October's paltry payroll gain of 12,000. That number was revised higher to 36,000 but was skewed by Hurricane Milton.
The 10-year Treasury yield was essentially flat around 4.18% ahead of the jobs data. It was down four basis points to 4.14% after the report. Over at CME FedWatch, futures traders now think there's an 87% chance that the Federal Reserve will cut rates by another 25 basis points this month. But rate cut expectations for next year, at least for now, have been dialed back quite a bit.
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Ulta Beauty (ULTA) and Lululemon Athletica (LULU) brought more good cheer to the retail sector with decent earnings reports.
Ulta stock soared more than 10% despite another quarter of lackluster growth. Adjusted profit inched up 1%, while revenue edged up 2% to just over $2.5 billion. Ulta bumped up its full-year earnings guidance and revenue guidance, but the new earnings guidance seemed to be in line with the FactSet consensus.
Meanwhile, after a strong rally off lows, Lululemon soared more than 15% after fiscal Q3 revenue growth accelerated from Q2, rising 9% to nearly $2.4 billion. The results were helped by strong growth in international markets, with same-store sales in China up a better-than-expected 4%. Total revenue increased 2% in the Americas and 33% internationally, although international revenue is still a small portion of total revenue.
Several other earnings reports made headlines. Veeva Systems (VEEV), a provider of software to the life sciences industry, gapped out of a lengthy consolidation. Shares jumped more than 5% after the company reported a 31% rise in quarterly profit, with revenue up 13% to $699.2 million.
E-signature leader DocuSign (DOCU) vaulted around 20% after results topped expectations. The company also lifted its full-year revenue guidance. Like many other growth stocks currently, DocuSign was quite extended headed into its report. The weekly chart shows a breakout from a handle the week of Sept. 27. The stock still hasn't tested its 10-week moving average after a big run. A pullback and bounce off the key support level would put DocuSign in an alternate buy zone.
In the security software group, recent IPO Rubrik (RBRK) vaulted 25% to above 70 after the company reported fiscal Q3 revenue of $236.2 million, up 43% year over year. Rubrik didn't show great price action when it went public April 25 at 32 a share. Rather than rally a bit from the IPO price, it immediately started moving sideways. But a 23-week consolidation yielded a powerful breakout during the week of Oct. 11.
Follow Ken Shreve on X @IBD_KShreve for more stock market analysis and insight.
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