The economy added 74,000 new jobs in the month of December, the lowest monthly-gain in three years and well below economists’ expectations of 200,000 jobs. The unemployment rate fell to 6.7% from 7.0% in November according to the Labor Department. The decline was due at least in part to people dropping out of the workforce. The unemployment rate is the lowest since October 2008, but the sharp decline in job creation may lead the Federal Reserve to re-examine its plans to cut back its $75-billion dollar a month bond-buying program. The percentage of Americans working or looking for work remains near 35-year lows at 62.8%.
Target (TGT) said a massive data breach during the first three weeks of the holiday season affected as many as 70 million people, 30 million more than originally reported. The stock was under pressure after the news, down more than one percent. The company also updated its guidance on fourth quarter same-store sales, now forecasting a decline of 2.5%. The company previously forecast sales would remain flat for the quarter.
Shares of Sears Holdings (SHLD) plummeted in early trading after the company reported disappointing same-store holiday sales at both its K-Mart and Sears locations. Sears sales saw a decline of 9.2% compared to last year and K-Mart sales slumped 5.7%. Sears Canada sales fell 4.4%. It's been a tough start to the new year for Sears Holdings as shares have fallen almost 10%.
Alcoa (AA) was also sharply lower in early trading after the company missed earnings expectations for the fourth quarter. Alcoa reported profits of 4-cents a share, missing estimates by 2-cents. Revenue came in 5% lower than last year at $5.59 billion, but beat estimates of $5.34 billion. Alcoa also reached a $384 million dollar settlement with the Securities and Exchange Commission and the Department of Justice over charges of bribing officials in Bahrain. Alcoa shares are up just over 19% in the past year.
Abercrombie & Fitch (ANF) fared better, soaring more than 14% in early trading. Like many retailers, Abercrombie's holiday sales declined from the previous year. The company saw comparable store sales fall 6%, but that didn't seem to bother investors because experts were expecting much worse numbers. Abercrombie also raised its per-share adjusted earnings outlook for the year to a range of $1.55 to $1.65 from $1.40 to $1.50. It's been a tough 12-months for Abercrombie, with shares down more than 31% in that time.
And Gap (GPS) reported same-store holiday sales were flat in December. Analysts were expecting a 1.5% increase. Gap also said that it expects to come in at the high end of its projected full-year earnings guidance range of $2.57 to $2.65. Shares of Gap are up almost 26% in the past year.