Unit Labor Costs Remain Negative

Economic Data Summary - Initial Jobless Claims increased to 209K, slightly above the estimated 205K, but down from the revised 210K the previous week, indicating a stable labor market with an average of 206K claims over the past six weeks [2] - Continuing Claims fell to 1.827 million, the lowest level in a year and a half, showing a significant decrease from the range of 1.9-1.974 million observed last year [3] - Q3 Productivity remained unchanged at +4.9%, marking the best quarter since Q3 2023, potentially linked to advancements in AI [3] - Unit Labor Costs stayed at -1.9%, the lowest since -2.9% in Q2 of the previous year, suggesting a favorable economic environment with higher productivity and lower labor costs [4] - The U.S. Trade Deficit for November dropped to -$56.8 billion from -$29.2 billion the previous month, significantly better than the all-time low of -$136.4 billion in March of last year [4] Company Earnings Reports - Mastercard (MA) reported earnings of $4.76, exceeding expectations by +13%, with a trailing four-quarter average beat of +3.1% [5] - Caterpillar (CAT) achieved earnings of $5.16 per share, a +10.5% surprise, with revenues of $19.13 billion, surpassing expectations by +6.6% [5] - Lockheed Martin (LMT) experienced its first negative earnings surprise since 2017, reporting $5.80 per share against expectations of $6.24, but shares rose due to a +9.1% increase in revenue [6] - Valero (VLO) delivered strong results with earnings of $3.82 per share and revenues of $30.37 billion, exceeding expectations by +18.62% and +8.24% respectively [6] Upcoming Earnings Reports - Apple (AAPL) is expected to report fiscal Q3 results with a projected earnings growth of +10.4% and revenue growth of +10.87%, having only one earnings miss in the past five years [7] - Visa (V) is anticipated to report a +14.18% increase in earnings and +12.5% in revenues, maintaining a strong track record with an average earnings beat of +2.7% over the last four quarters [8]