This morning’s news on the jobs front was not just bad, it was a little bit shocking in light of how easily the economists accepted yesterday’s ADP as foreshadowing. But the market is pretty much unfazed (as of this 10 am posting). The banks are down less than 2% and the VIX must’ve slept through its alarm clock this morning, it’s a no-show. Apple is green on the day and I’m already seeing people reach for the secular growers/momentum darlings like Chipotle.
Here’s my firm’s PM, Kevin Lane, on today’s market reaction and what we’re looking for:
ADP report showed good private sector employment on Thursday but today’s job numbers showed virtually no growth as it includes other hiring such as government hiring and is a broader measure. That said it is not the headline news that matters but more how stocks react to it that is the most important. Today, a summer Friday, will be a good litmus test to tell us how real the bounce of the last several days was and how much conviction the buyers have. If the move was real then the market should not accelerate the sell off on this news but rather absorb it and possibly reverse the negativity.
So we think today’s activity will give us some clues on where we are headed directionally over the next few months.
Initial support on the S&P 500 is 1,340 and 2,836 on the NASDAQ.
There’s a lot of trading ahead of us today so we’ll see.
(the above market commentary is general in nature and does not constitute individually-tailored advice or a solicitation)
Tags: $CMG $AAPL $VXX $XLF