The Dow Drops Again on Good Econ Data ...

A shockingly strong jobs report also helped limit the Dow Jones Industrial Average's loss to just 25 points Wednesday after being down more than 100 points midday.

1. J.C. Penney sales pop, but the stock gets smacked 
Ya win some and ya lose some. Struggling retailer J.C. Penney reported an impressive 10% jump in sales last month, matching Wall Street's expectations -- but the stock dropped 4.45% Wednesday as investors decided that your aunt's favorite source of V-necks needs to do better if it's going to survive.
It's been a painful year for J.C. Penney. After nearly two years of sales declines, JCP finally fired iPad-obsessed CEO Ron Johnson last spring since his aggressive rebranding strategy was simply not appealing to consumers. Mike Ullman now has the reins, and he's been helping sales steadily improve over the past six months.

The takeaway is that the holidays are all about family, friends, and ruthless retailer competition. Investors are worried that J.C. Penney has been improving sales through deep discounting all fall -- but now competitors such as Wal-Mart are also slashing prices for the holidays. Black Friday weekend sales already dropped for the first time since 2009, and that's not going to help JCP look pretty, either.
2. ADP reports huge 215,000-job gain
Boom! Here come the jobs. According to the huge payroll company ADP, 215,000 private-sector jobs were added to the U.S. economy in November, crushing the 178,000 economists expected. ADP's numbers are an estimate -- investors are mainly focused on the official jobs report from the Labor Department due Friday morning (think of ADP as a nice appetizer).
Small-Business Saturday paid off, with a shocking 102,000 of the new jobs coming from companies of 49 workers or less in size (where incentives include the best Christmas parties and more intimate intra-company dating drama). Small businesses are able to pounce on smaller growth opportunities to create jobs, which is why politicians mention their importance over and over in speeches. Speaking of politicians ...
Despite a horrible climate in D.C., the economy actually seems to be gaining steam -- businesses are moving on from the buzz-killing vibes of Congress after the government shutdown. On the flip side, Wall Street interprets this good jobs news as fuel for the Federal Reserve to slow down its stimulus policies -- but we'll have to wait till Friday's report. That's the real good blue stuff.

3. New home sales crush expectations
Home sweet home data. According to the Commerce Department, sales of new homes jumped 25% in October, rebounding from their lowest point of 2013 like a young, barely tattooed Dennis Rodman. That's an annualized pace of 444,000 new homes sold -- well above economists expectations.
Just to clear up any confusion, the government actually released two new home sales reports Wednesday. The first was from September that showed a drop, but the second one was for October -- and that month's major sales gains were all the investors cared about. The awkward "double-report-release" occurred because September's report was delayed by that pesky government shutdown. Lame.
The takeaway is that the housing market smacked since '07 has been steadily recovering over 2013 thanks to low borrowing rates created by the Fed's low-interest rates and the slowly recovering labor market. That one-two punch combo has been putting some pep in the step of both home sales and home prices. And homeowners are feeling jolly about it, which is huge for holiday season spending.

  • Revised third-quarter U.S. GDP numbers
  • Weekly Jobless Claims
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