Friday, January 10, 2014

Economic Journal - Friday, 1/10/2014

(As of 7:10 am PST)
 
It’s quite a surprising start for Wall Street this morning.  Investors were greeted at their desks this morning by an unexpectedly low jobs number that caught markets off guard.  According to the Labor Dept., just 74,000 jobs were added to the private sector in December.  It was the smallest increase in over 3 years and well below the 193,000 increase forecasters were expecting.  The unemployment rate plunged unexpectedly as well from 7.0% to 6.7%, due in large part to nearly 347,000 Americans dropping out of the labor force.  The stock market initially reacted in its recent “bad news is good news” fashion before stalling out and reversing course.  Despite the surprisingly low figure, one month worth of data is not likely to dissuade the Federal Reserve from its taper plans which will begin this month.  Gold is up 1% on the negative jobs report and interest rates dropped sharply with the 10 yr. treasury falling from 2.97% to 2.88%.  In other news, earnings season is “officially” underway as Alcoa reported an earnings miss after the bell yesterday.  The market is struggling to find direction with this jobs number, as sentiment has turned negative for the time being.  As we get this jobs number behind us, expect a return to fundamentals with earnings season driving market action for the next several weeks.

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