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Jobs Again!

October 8, 2010 – 4:55 pm

Every month we go through the jobs dance in which the market anticipates and reacts to the loss or gain of jobs. Investors and traders all know that the monthly jobs report is a lagging indicator and really does not tell us anything about the future of the economy or stock prices but fear is a persuasive manipulator and if there is any strong fall or gain in the jobs numbers the market will react sharply.

This morning we received September’s report and the jobs number was a little weaker than expected. We lost 95,000 total jobs all of it due to government workers being laid off. The private sector added 64,000 new workers and they revised ‘up’ last month’s numbers of jobs that were created. The market didn’t like it but it didn’t react much either. Maybe it is because Alcoa reported after hours last night better than expected earnings and guided higher for the next quarter. It was a good report but not great.

Earnings in the coming weeks will likely be the dog wagging the tail of the market as we wait for next months jobs report. Please note the tail doesn’t go in just one direction, although I do believe we will have a year end rally.

Good Trading,

Steve Peasley

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