ADP's Jobs Prediction, Goldman's Historical Change, and University of Phoenix Flunks on S&P 500 Record Day

Good evening, good lookin'. Here are the three things you need to know on April 3.

Apr 2, 2014 at 11:00PM
Planning to celebrate another record high for Wall Street by enjoying a few microbrews in a brand new "surf sauna?" Not too shabby. While the S&P 500 topped its highest mark ever for the 2nd day in a row, the Dow Jones Industrial Average (DJINDICES:^DJI) rose 40 points Wednesday on some solid jobs figures.

1. ADP jobs report predicts strong March job gains
The number of the day is 191,000. That's how many jobs the payroll-tracking firm ADP estimates the U.S. added in March, which is right in line with analysts' expectations. After a surprising dip in February from brutal winter weather that slowed manufacturing and affected housing turnover and overall consumer activity/morale, the March figure is a nice rebound, and sits slightly above the 12-month moving average.

Interestingly, financial-services firms enjoyed their fastest rate of growth since last November, after the industry cut 10,000 jobs in the first couple months of 2014. The construction sector, though, helped lead the rebound, with 20,000 new jobs in March. Like the slingshot you used as a kid to terrorize neighbors and show off to the cute girl next door, there appears to have been pent-up job demand from the winter's economic hibernation.

The takeaway is that the ADP number is nice, but it ain't official. Wall Street uses the ADP figures as a preview for the real, big-time monthly jobs report that the Labor Department releases on the first Friday of a new month (aka this coming Friday). Given the rebound ADP has shown, investors will be expecting a similar improvement following February's mediocre numbers.

2. University of Phoenix-owner plummets
It's detention time for the company behind the online University of Phoenix. Apollo Education Group (NASDAQ:APOL) dropped over 9% Wednesday on a combination of mixed earnings news and some bad publicity. Investors punished the stock like they were taking away its recess time.

Wall Street gave the earnings report a B- after Apollo's revenues of $679.1 million were a 19% decline from last year. The main problem wasn't the "rigorous" acceptance rate, but the 17% drop in enrollment at the University of Phoenix, which added only 32,000 new students for a total of 250,000 (that might also hurt fraternity pledging numbers this semester).

What's worse is the subpoena notice that the University of Phoenix received just two weeks ago concerning its operations practices in the Mid-Atlantic region. Apparently some marketing, financial aid, and student retention practices bothered the Office of the Inspector General. Too bad for Apollo shareholders that no one could call on-campus public safety instead.

3. Goldman Sachs selling its stock exchange floor-trading unit
The times they are a-changin'. Goldman Sachs (NYSE:GS) announced Wednesday that it's selling its floor-trading business on the New York Stock Exchange to Dutch firm IMC Financial Markets. Those floor-traders are the classic, balding, creatine-crushing guys you see yelling at each other whenever the nightly news reports anything about Wall Street. They're known as "market-makers," since their primary job is to match buyers and sellers for stock trades.

Computers have for years been increasingly replacing human traders. But before you get too nostalgic, keep in mind that IntercontinentalExchange Group, which bought the historic New York Stock Exchange in 2012, promised it would maintain people on the exchange floor, as they help facilitate trade orders.

Thursday:
  • The International Trade Report tells us about American imports versus exports.
  • Weekly Jobless Claims come in ahead of Friday's big monthly jobs report.

As originally published on MarketSnacks.com

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