why traders say the april jobs number is critical to the trading session.. in today's cover story.... the new struggles facing the shrinking middle class. and ... the hot new startup that has travelers passing on hotels to share a home with strangers. plus...the guys break out their hats...for derby day. first business starts now! you're watching first business: financial news, analysis, and today's investment ideas. good morning! i'm angela miles. it's friday, may 2nd. in today's first look: wait for it.... that's what traders are doing ahead of the employment report for april. it's expected 210,000 jobs were added to payrolls. and the unemployment rate will dip to 6.6%.

the market was mildly mixed on the first day of may. the dow pulled back 22 points, the nasdaq up by 12 points as tech momentum stocks such as facebook rallied. the s&p was unchanged.gold lost $10 dollars and oil edged down 51 cents. linkedin posts a loss.shares fell after the close as the social media company failed to turn the profit.and, gm will be in bankruptcy court today.the hearing will focus on "old gm's" liability over the ignition-switch issue. gm is requesting a voluntary halt to lawsuits by drivers. it's a jobs friday. joining us now is larry shover of sfg alternatives to break down this market action for us. good morning larry. >>good morning. >>we have the jobs number coming out today but there are lots of mixed signals in the market coming from treasuries, equities and even oil. what are you watching?

>>i'm watching all 3 actually. especially when you look at the yield curve. right now the 10 year yield 2 spot 61. the yield curve is flattening . that means the difference between the 2 year and 10 year is compressing. that means either there is a lack of inflation or lack of growth in the market. it's disconcerting to me for the stock market. when it comes to the equity markets, i do believe the headlines have been good but there tends to be this continued rotation from value to momentum then momentum back to value. nobody knows what end is up. with oil we've seen wti blow $100 a barrel. again, that's great for the economy however how far is that going to continue? all these things are driving the market right now. >>with that battle between momentum and valuewhich way are you going? >>i'm always in value because i look for the long term. right now momentum is high, and so they do deserve some compression. i look long term investing. i do believe coast is clear investing never makes sense so i really like value. >>thank you larry. >>thank you.

weather was a huge factor in hiring during the winter months.. but with the jobs report for april..a market strategist from wells fargo advisors tell us... there is a limit to the weather excuse. "the weather-related effect will be minimal, at least for april. and then on to the revisions - that's where the weather might play a greater role, but most people will look at april as the most robust number, the one with the least amount of weather disruptions in it." most anayst predict there should be a pick up in hiring as the weather improves... chuck coppola joins us me know with a distrubing pay trend at subway... chuck coppola joins us me know with a distrubing pay trend at subway... angie...in the wage wars debate, it turns out subway is the worst fast-food chain when it comes to under-paying its

workers. a cnn study found that subway was investigated for pay and hour violations more than a thousand times in the last 13 years. subway pays employees minimum wage of seven dollars and 25 cents an hour. subway has not commented. the man credited with pushing the "doritos locos tacos". will become the next ceo of yum brands. yum owns taco bell, kfc and pizza hut. greg creed will run the restaurant chains starting january 1st.he replaced david novak who has served as ceo since 1999.creed is viewed as improving taco bell's image.although, the success of the waffle taco however is still not clear.taco bell's performance has been strong, while pizza hut and kfc struggle with declining sales. ford is also shuffling up its management. the company confirmed thursday ceo alan mulally will retire earlier than expected, on july 1st.the new face of ford will be c-o-o mark fields. "we're just starting to see the benefits...of the power of the one ford plant. and also, our committment is to continue to

bring those great products out, with great innovations that will not only help fuel our growth, continue to fuel our growth going forward, but also to help define our company. " outgoing ceo alan mulally is credited with guiding the automaker through the dark days of recession, and returning ford to profitability.however -- yesterday its april sales numbers rolled in with a disappointing 1% sales decline. car sales at other automakers bounced back in april as warmer weather lured drivers out to dealerships. nissan sales jumped 18% from last year, chrysler sales up 14%, and toyota - 13%. gm, under pressure from a massive recall investigation, surprised everyone with a 7% gain. analysts say the numbers are a good sign for gm -- but only in the short term. "that just goes to show that of all these people that had these cars that were recalled, they're not necessarly in the market to buy a new car and so these recalls may not effect general motors auto sales right away in one month, it might be a slow drag over the next few years. that was kelsey mays of cars.com. he adds drivers bought bigger cars in april. pickups and suv sales were up as

demand for fuel efficent models ticked down. in today's cover story---the international distress call "mayday" may apply to america's middle class during events to celebrate those who work for a living. with wages flat and a greater distribution of wealth going to top earners, the american institute of c-p-as says more americans are accepting financial difficulty as a way of life. "i ain't got a dollar bill, ain't got a cent..." while demonstrators showed their may day support for immigration reform and workers rights, recent surveys say middle class americans are no better off than they were a year ago although more are trying harder than ever. "actually, in the last two quarters, we're seeing more people than in the last two years." among the reasons, she says--- people who gave up looking for work and were no longer counted in the unemployment rate are starting the cycle of looking all over again.

"i think we're seeing a lot of long-term uinemployed resume looking. we're also seeing a lot of people who are underemployed--working half- time." but mid-level job seekers must still contend with layoffs. they may be at their lowest in 19-years but they still happen in significant numbers--more than 25-thousand in retail so far this year. more than 19- thousand layoffs this year in the financial sector as banks shed extra workers hired to handle the recent flood of foreclosures. and the tech sector has cut nearly 12-thousand jobs--- nearly as many as were cut in all of last year. no wonder cpas say their clients are stressed now as much as they are during the year-end holiday season. "the number one reason is unemploynment, followed by making less money than before, credit card debt and student debt. it's all starting to wear on people." the american institute of c-p-

as advises pay cash for as much of your summer vacation as possible. and if you stay close to home, instead of going away---and have children--to budget about 14-hundred dollars for summer activity including camp, tutoring, sports tournaments and child care. 8 million americans have signed up for health care. the obama administration says the number exceeds their targets. a surge in sign ups in march resulted in numbers doubling in texas, georgia and florida. the white house report however did not include how many americans have paid for insurance. avon is agreeing to settle bribery charges with the justice department and s-e-c. the cosmetics company will pay a total of $135 million in fines to government agencies to resolve the probe into bribes paid in china. shares slipped more than 10 percent thursday after avon revealed first- quarter profits - were hit by slow sales and a shrinking crew of sales reps. the new york stock exchange and 3 affliates will pay a $4.5 million penalty for repeated rule violations. the sec says the violations happened between 2008 and 2012. it involved the handling of orders and other practices. the exchange will not have to admit or deny the sec

allegations. the nations coal mines face safety violations. regulators issued 152 citations after inspecting 10 coal mines and three metal mines, in march.the report cited hazards such as "under" trained workers and the accumulation of combustible materials in mines. the inspections began after a west virginia mine explosion in 20-10 that killed 29 coal miners. at&t reportedly is considering a bid for directv. the wall street journal reports at&t has approached the nation's largest satellite tv distributor.shares of directv soared 4% thursday. if the deal happens... the comcast, time warner combo could end up number 1 --with nearly 30 million substribers if that merger is approved. and at&t, directv would follow with 25.7 million subscribers. there is also chatter-- sprint may make an offer for t-mobile. for the third time--- sony is issuing a profit warning. the electronics maker blames the cost of disconnecting from its personal-computer business and slow sales for its remaining electronics products which led

to a big first-quarter loss. analysts say another profit warning may have even loyal investors questioning the companies turn around efforts. shares fell two-percent yesterday. in earnings watch this morning. net income droped at exxon mobil for the 4th consecutive quarter. exxon produced slightly more oil than last year. but invested late in natural gas production and continues to pay the price. clorox, the maker of bleach -- reported 3% earnings growth --as it raised prices and cut costs. and, cereal sales at kellogs are slipping. and it's an ongoing issue as americans eat more yogurt, eggs and peanut butter. the company's earnings came in above analysts estimates while revenue and the forecast missed the mark. billionaire investor warren buffett could face a tough crowd this weekend...30,000 shareholders will attend berkshire's annual meeting in omaha, nebraska. the ablitiy of the oracle of omaha to beat the

stock market may be called in to question. buffett has failed to beat the market in 4 of the past 5 years. it should be noted-- he wisely choose not to invest in internet stocks during the 90's and successfully avoided the dot com bomb! and, last year berkshire's profit rose more than 31% to $19 billion dollars. still to come: a trader takes a long shot on an oil company that's tricky to trade on earnings.. plus...with derby day around the corner, where traders are placing their bets.... and, ... is airbnb rolling out the welcome mat for an ipo? find out, after the break!

hotels are becoming a thing of the past-- as airbnb--begins to take more space in the hospitality sector. the company offers vacation rentals in homes, apartments and even igloos. chip conley, airbnb.com's head of global hospitality joins this morning. this is a business that started with air mattresses and now has ballooned to a $10 billion valuation. how were you able to do that? >>i think what we've clearly tapped into is an unmet need. people wanted to stay in each other's homes around the world and have more space for less money and they've been doing it for years but we allowed technology to make it easier for people and create a trusted platform. >>but not without controversy. some citiesincluding new york and san franciscoare concerned about these short term rentals. how are you fighting that matter? >>truthfully, we are in 35

thousand cities in the world. so we have a little bit of controversy in a couple of cities but not that much. more and more countries and cities are embracing us. i love talking about the destinations so i'd love to tell you about some of our fastest growing destinations in the u.s. >>before we get to that i have one other questioni want to ask you about these igloos and treehouses. with so many great destinations in places like that, why not do an ipo? >>what's an ipo? somedaywho know? not anytime soon. >>let's move on to your top destinations. what is your number 1 destination? >>well, these are the fastest growing destinations in the u.s. number 1 is nashville, tennessee. it's the country music capital of the world but it's also a food and wine destination. more and more people are going there to dine and enjoy themselves and the countryside outside nashville. that was first place in terms of year over year growth. second place was new orleansin fact, a place that i love going to visit. there's lots of festivals in new orleans and

when all the hotels fill up what happens is there's lots of listings of airbnb homes. we actually have a creole cottage there that feels very much like an authentic local experience. the third place is palm springs, california. people are actually going to the desert outside of los angeles year round, not just during the winter. >>good to have you on the show and best wishes with your company. it sounds exciting. >>thank you very much. coming up...the weather is no longer an excuse! why that's putting pressure on today's jobs report. plus...saddle up. the guys are off to the races in today's traders unplugged. stay with us!

affleck,

and many actors have played the part of u.s. servicemen in the movies, but for veterans like james crosby their service and their sacrifice are real. and too often when they come home, their struggle continues. for over sixty years, paralyzed veterans of america has been fighting to help our injured veterans get the benefits they need, and have earned. paralyzed veterans of america was there for me when i came home. join me in supporting our paralyzed veterans. visit p-v-a dot org.

it's our favorite time of the week. it's time for traders unplugged. joining us now from the floor alan knuckman and andrew keene. good to have you guys back together. topic 1-- social anxiety is it time for investors to unlike social media stocks? alan: i liked facebook a lot better when it came down below that $55 level. it's already up 13% in just a couple of days. so i don't think necessarily today but i think long term it's going to be fine but understand there's volatility there. andrew: i think it's stock specific. i do like facebook as a stock and as a company. i think they're doing everything right on the mobile space. earnings are really good and the stock actually sold off. i don not like twitter or pandora. and i like yelp, linkedin and facebook. alan: the lesson is to be selective. andrew: i like facebook the most. angie: topic 2 - flipping out- home flippers are making money againis there a way for traders to make money?

andrew: if i had to pick a homebuilder stockwhich i'm not long any of them. i was actually long home depot and i took off that position and made money on it. another one is hov. we saw institutional order flow. the stock is trading at $4.5. looks like it's consolidating here and might be able to make a push to 5 by the end of june. i do not have a position on right now. alan: what's interesting is the homebuilders right now are only up 5% in our last 52 weeks so they might be an opportunity here as they have not kept pace with the market. but a big factor i think is people are focusing on interest rates. they think that's slowing things down but the reality is since the lows in 2012 in interest rates, the homebuilders are up 70%. so they can move up pretty nicely even when rates eventually have to go up. andrew: pick a stock. alan: the xhp index. angie: topic 3-- pony up- prices are up for ponies running in the kentucky derby. is that a positive sign for the stock market? alan: well it's a sign of more money out there flowing around. i saw that prices are up 30% in the last year. $200 thousand

was the average auction. so it is an interesting fact but it's just like who wins the super bowlit doesn't mean anything to me as a trader. andrew: it doesn't mean anything to me as a trader either. when i was on the trading floor 5 or 6 years ago they used to talk all the time about how traders would invest n ponies. i don't know one person that made money. people thought it was a cool thing to own a horse that was going to race in the derby. alan: wicked strong is 8 to 1 and the market has been wicked strong so i thinkn that's a theme. angie: you're already warmed up for them bonus round questionthe run for the roses-- is it better to bet on a pony or buy shares of churchill downs? alan: churchill. andrew: i love betting on the ponies. i'll take the ponies. alan: you can't control risk on the horses. andrew: you can. what you bet onthat's your controlled risk. angie: churchill downs is up 136% since 2010 and california chrome- best odds at 14- 1. i think i'd go with churchill downs. great to have you on the show. you did a great job. first business continues right after this.

i'm afflec

and many actors have played the part of u.s. servicemen in the movies, but for veterans like james crosby their service and their sacrifice are real. and too often when they come home, their struggle continues. for over sixty years, paralyzed veterans of america has been fighting to help our injured veterans get the benefits they need, and have earned. paralyzed veterans of america was there for me when i came home. join me in supporting our paralyzed veterans. visit p-v-a dot org.

chevron is the next big oil company to report earnings. earnings are due this morning. good morning to james ramelli who's watching the charts for us. james, this stock could be hard to fight. it has been going higher into earnings. >>it has but if we take a look at how it performs on earnings day, it's actually a relatively mixed mover. it sold off 4 times and rallied 4 times over the past 8 quarters. what makes chevron tricky to trade on earnings is the fact that it doesn't move that much. the stock is trading just under $125 and they're only implying around a $2 move to expiration today. so it's not going to be a stock that's a high flyer. i was looking to get short premium and try and fade that movement into chevron. i was not filled in by a trade but i don't think

that we're going to see any huge moves higher. we have seen nice bids in a lot of the other big cap oil names. i do think chevron is going to rally but i don't think it's going to move very much. >>maybe not so much now but you're thinking maybe long term? >>right. i think that this is one that's going to grind higher over the long term. that's typically how this stock trades. we don't really see very big moves. like i said, the stock is trading around $125 and they're only saying it can move $2 on earnings which is barely a move for a stock that trades at such a high price level. >>that's barely a budge for you traders. what about the overall market conditions? we have the jobs number coming out todayhow are you playing that james? >>this is going to be a very crucial employment number. i think it's going to be the most important one we've heard all year. that's because this time around they're not gonna be able to blame the weather if it comes in below estimates . we saw pretty choppy price action

on thursday as traders were sitting on their hands waiting for this number to come out. i think the fed was a non-event and we're all concerned about this number. we really need a good number out of this report for the market to make new highs. they are implying the market can go about 10-12 point higher should the number come out and if traders buy the market. but i think that puts us in an area where we're going to find resistance again because it's going to bring us right around to the all time highs. >>good information. thank you james. thanks so much for watching today. coming up next week, why the economy maybe in better shape then most people think. we hope you will join us. from all of us at first business...have a good weekend!

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