What appeared to be the start of a sustained jobs-report-fueled rally has already fizzled, with the major indexes beginning to sink almost immediately after the opening bell. The Dow had jerked up more than 100 points in pre-market trading after the government said the economy had added more jobs than economists had expected, but the overall employment trend is still spotty, and the index began to shed its gains. It is now up about 60 points, but the S&P 500 is trading slightly lower.
Some of the details in the report show that the economy is still struggling add jobs. The 103,000 jobs added in September were boosted by the return of 45,000 Verizon workers who had been on strike. And employment in manufacturing fell by 13,000 jobs and has been “essentially flat” for the last two months, the Labor Department noted.
“As solid as this report is, it is not an all clear signal. Structural rigidities remain, the participation rate is up but still close to multi-decade lows, and private job growth still needs to move closer to 150,000 for the Fed to breath easier,” wrote Eric Green of TD Securities. The Wall Street Journal has a lot more reactions from economists here.
Bank stock are sliding after a big rally yesterday afternoon. Bank of America (BAC) and Goldman Sachs (GS) were each off by about 2%.
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