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Stocks Climb on Disappointing Jobs Data; Netflix Turns Red After CEO’s Warning

Dan Berman
Hot Stock Minute

Stocks climbed on a weaker-than expected jobs report for September which suggests the Fed won't begin to taper its bond-buying program in the near future. The Labor Department says there were 148,000 jobs created during the month, significantly below expectations which were for about 180,000 jobs. The unemployment rate unexpectedly dipped to 7.2% from 7.3%, which is its lowest level since President Obama took office. However, the labor participation rate remains at its lowest level in decades. The jobs report was delayed 18 days because of the government shutdown, but it does not include the shutdown period which began October 1st.

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Netflix (NFLX) shares closed down over 8% after a very personal warning from CEO Reed Hastings. He expressed concerns of "euphoria" after the stock soared more than 11% this morning to a new all-time high. Share prices had spiked on the company's earnings report which came out after yesterday's closing bell. Netflix made 52-cents for the quarter, 3-cents better than estimates. Revenues were also slightly above the consensus at $1.11 billion. Netflix now has more than 31-million customers in the U.S. That's a rise of 1.3-million since the last quarter and more than HBO.

Three Dow components reported earnings this morning: Dupont (DD), Travelers (TRV), and United Technologies (UTX). Looking at all-three alphabetically, Dupont beat by 4-cents a share for the quarter with adjusted earnings of 45-cents a share. Sales also topped estimates at $7.81-billion versus $7.777-billion. Travelers easily beat on earnings posting profits of $2.30 a share versus estimates of $2.07. But revenues fell shy of expectations at $5.71-billion versus $5.741-billion. As for United Technologies, sales were nearly $700-million short of estimates at $15.462-billion, though earnings beat by a penny at $1.55 a share.

Coach (COH) and Whirlpool (WHR) both made big moves today on their earnings. Looking first at the luxury retailer, it dropped more than 7% as North American stores saw their biggest sales dip in almost five years. The company actually beat earnings estimates by a penny with 77-cents a share but sales were $1.15 billion versus estimates of $1.19 billion. Coach has been losing market share to Michael Kors and Kate Spade.

As for Whirlpool, it climbed 12% after reporting profit that roughly doubled. The appliance maker earned $2.72 a share which was 11-cents better than estimates. Revenues fell short of the forecast at $4.68-billion versus $4.74-billion, but the company says it has been successful with cost-cutting measures and raised its outlook.

Among the other companies which reported today: Delta Airlines (DAL), Harley Davidson (HOG), Kimberly-Clark (KMB), Lockheed Martin (LMT) and Radio Shack (RSH) which plunged over 17% on its quarterly report. The chain lost $1.11 a share on $805.4-million in revenue. Expectations had been for a loss of 35-cents a share loss on $892-million in sales. Radio Shack says same-store sales dropped more than 8% as the company tried to unload stockpiles of less profitable merchandise.

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