Friday Roundup: U.S. adds 103K jobs; Aureon Biosciences folds; State approves Memorial Sloan-Kettering project

TGIF. It is a beautiful Friday, the weekend is shaping up to be a great one, and Alex Rodriguez made it two consecutive seasons in which he has ended the New York Yankees’ playoff run with a strike-out. On to the news!

Driving the day: The U.S. economy added 103,000 non-farm jobs in September, exceeding nearly every analysts’ projections. That said, the employment rate held steady at a discouraging 9.1 percent. T.D. Bank senior economist James Marple said, “This was definitely a good report and a repudiation of the most strident calls that the U.S. has already slipped into recession. Nonetheless, we should hold off on breaking out the champagne.” Marple also predicted that the U.S. GDP grew at a rate of two to two and a half percent for the third quarter of this year (which would be an improvement over the second quarter, but still far below pre-recession levels).

Some notes of importance:

  • The employment numbers were buoyed by the return to work of approximately 45,000 striking Verizon employees.
  • The Bureau of Labor Statistics revised last month’s job data up by 57,000 (from initial estimates of zero job growth), another positive.
  • Including the above revisions, the last two months have averaged job growth of 80,000 per month.
  • Moody’s chief economist Mark Zandi said on MSNBC this morning that the economy needs to add between 125,000 and 150,000 jobs each month if we are to see the unemployment rate drop.

**New York State will release the state’s unemployment data for September on Oct. 20th.

They Said It: “I think we’re in as much a psychological slump as a real economic slump.” – Eleanor Clift, at Business Council of Westchester’s 2011 Annual Dinner, held last night at the Hilton Rye Town.  

Headlines:

> Yonkers biotech company Aureon Biosciences unexpectedly closed last Tuesday, according to documents filed with the N.Y. Department of Labor. Founded in 2002, Aureon was a founding member of “N.Y. BioHud Valley,” a public-private campaign aimed at promoting the Hudson Valley as a hub for biotechnology research and development. With the closing, the company’s 95 employees were laid off. More on Aureon Biosciences closing coming soon at WestfairOnline.com.

> Memorial Sloan-Kettering’s plan to build a $143 million, 114,000-square-foot cancer treatment center at 500 Westchester Ave. in Harrison was approved yesterday by the N.Y. Public Health and Health Planning Council, clearing the last major hurdle for the project.

Opening Bell: 10/4 (Moody’s cuts Yonkers rating; IBM thrives; Manufacturing posts modest rise)

The lead story of the Wall Street Journal: “Market Nears Bear Territory.”

Good Tuesday Morning!

Driving the day: Moody’s Investors Service cuts Yonkers’ bond rating by two notches, down to Baa1, just three levels above “junk” status, and reduced Yonkers’ outlook to negative from stable (previously, the city’s bond rating had been A2, the sixth-highest investment-grade rating). In its report, Moody’s said that projected budget gaps through 2015 and unsettled collective bargaining contracts with city employees would continue to represent challenges for city government officials.

Two things of note to take from this news: (1) First, mayoral elections in less than a month, it presents brand new challenges to whoever takes over for Mayor Phil Amicone. Yonkers has been riding a hot streak as of late with its Ridge Hill development, waterfront development and activity around the County Center; this puts a bit of a damper on that. (2) Second, the report foreshadows more difficulties to come for many of the state’s municipalities, with Moody’s analysts pointing to the 2 percent tax cap, saying that they will continue to monitor the impact of the new cap on any municipal debt issuance.

Stock Outlook: European indicators are continuing to fall this morning, which means more bad news for U.S. stock indexes. Also, watch for a reaction to Fed Chairman Ben Bernanke’s testimony before Congress at 10 a.m.

As an aside, note that the stock market has been falling consistently on European woes and not on a perceived decline of U.S. companies’ values. Whenever Europe starts to turn itself around, U.S. markets will be poised for big gains with the currently undervalued state of many S&P 500 companies.

By the Numbers: 1.3% – as in, the increase in construction spending for the month of August, an encouraging sign given what we know about August job numbers. Notably, public construction spending rose 3.1 percent (with residential construction up 0.7 percent).

Headlines:

Small businesses that are hiring say the biggest challenge is finding qualified workers. In a survey of 133 executives who attended Inc.’s 500|5000 Conference (i.e., businesses that have posted strong growth numbers), 40 percent of those queried said that finding qualified workers was the biggest challenge, versus just 13 percent who cited the sluggish economy and 16 percent who cited difficulties securing capital. (Inc.)

IBM is targeting mid-sized acquisitions as it continues to post strong growth numbers, one executive told Bloomberg News. IBM recently passed up Microsoft Corp. as the world’s second-most valuable tech company behind Apple.  (Bloomberg)

U.S. manufacturing index rises unexpectedly in September on strong gains in exports. (Bloomberg)

Fannie Mae knew of abuses, report says, citing a lack of oversight at the Federal Housing Finance Authority (the report was authored by the FHFA’s inspector general).  (NY Times)

Sports Blink: With the Yankees on the brink of playoff elimination, A.J. Burnett will get the start in Game 4. Be sure to remove any sharp objects from the vicinity of the television…