More good economic news, but this tidbit speaks to a larger problem that I have discussed before – the devastating loss of manufacturing jobs since 1980.
U.S. manufacturers are finally adding jobs after years of shrinking their payrolls. They added 136,000 workers last year, the first net increase since 1997. And in January, the manufacturing sector added 49,000 jobs — the most in any month since August 1998.
The economy added manufacturing jobs in traditional manufacturing areas, which speaks to a revival in manufacturing areas that we dominated for decades and no longer do.
Over the month (January), job gains occurred in durable goods, including motor vehicles and parts (+20,000), fabricated metal products (+13,000), machinery (+10,000), and computer and electronic products (+5,000).
Yes, we have a long way to go, but, once again, transitions take time. In the meantime, I hope you all paid attention when I wrote about getting into the semiconductor space back in early January. I hope you pay attention now. The semiconductor space is highly pressurized from increasing demand. Expect that it will continue to outperform, at least for a bit more.
… semiconductor stocks had an impressive session. The group spiked 2.1% and is already up 12.5% year-to-date. Strength among semiconductor plays made tech (+0.8%) the strongest sector of the session and gave the Nasdaq a lead over its counterparts.
The market continues defying conventional wisdom as it inches its way up. Shorts are giving way to cautious longs, and the tone of the pundits is changing. Is this, then, the time to reconsider positions? Is this hardworking market getting ready for a pause, a pause that refreshes?
Me thinks we are getting close, especially as we approach the upcoming debate on raising the debt ceiling (March), the now active discussions about inflation, and the rising anxiety about the Fed’s ability to stay in front of that inflation, as well as the excess liquidity in the system from quantitative easing. How big will the “pause” be? Who knows, but I suspect some volume of air has to come out of the market if for no other reason than to convince the doubters that the money flow into the market is real and long lasting.
One more thing … This month, Futures magazine has a compelling article about the Forex market – “Apple iPad, dollar and parity.” I suggest you who trade Forex read the article, as it lays out a simple yet potentially successful strategy for finding the Forex trade. Tomorrow, I will lay out the broad strokes, which should just about cover the whole strategy.
Trade in the day – Invest in your life
