It seems the market anxiously awaits the September Employment Report coming out tomorrow, or so say the oracles residing atop Mt. Market. Nothing else could be causing such a lack of conviction …
Friday’s jobs report, however, is the big event, and it’s more weighty than usual because it could be a critical piece in the Fed’s decision making process about further easing.
Oh, wait! Floating down from above, the oracular voices now tell us conviction might come with other good omens …
Analysts say the market will need significant doses of positive news on the economy, corporate earnings or preferably both before heading decisively higher again.
And what exactly does “significant doses of positive news on the economy” mean? Is, for example, positive news on employment today significant enough to move the market higher?
The department [Labor] said job openings rose in August for the second straight month to 3.2 million. Private sector openings increased to their highest level in 21 months. That could bode well for future hiring. The department’s Job Openings and Labor Turnover survey also said that private-sector layoffs plummeted to 1.6 million in August, the lowest monthly total in more than four years.
Apparently not, as the market is retreating further as the day moves on. Even corroboration from a private employment tracker cannot dissuade the market from its appointed move …
The Monster Employment Index rose two points in September to 138 pointing to what the report describes as steady improvement in the jobs market. Gains in the month were evenly distributed.
So, perhaps, then, the corporate earnings beginning today with Alcoa will do the trick. The oracles tell us that the earnings will be good, but not as good …
Analysts expect earnings for S&P 500 companies will increase about 24% from a year ago, compared with 39% in the second quarter. The frequency and size of upside surprises, a catalyst for the stock market, also are likely to diminish.
Okay, okay! I should be looking to positive news on the economy, but not the labor news that came out today. The September labor report is more important. And I should wait to see if the corporate earnings reports that begin tomorrow are actually good enough to inspire the market to climb higher up the mountain. I’m sorry. Please excuse me. I have a silly question. What exactly do you mean when you tell us the market is concerned about the “Fed’s decision making process about further easing?”
Trade in the day; invest in your life …
