Stocks shrug off weak jobs report
Stocks in the US held Thursday gains initially as the payroll number released by the Department of Labor was somewhat on the soft side. With expectations climbing going into the release by the Labor Department many economists believe the payroll report was going to show a blowout number above 200K and were somewhat surprised by the 164K reported by the BLS.
Stocks edged lower and traded in a tight range, with technology stocks continuing to outperform. The 164 print was slightly less than expectations of 180K. The unemployment rate, dipped to 7.4% which it the lowest in the past 24-months. The dipped in the unemployment rate was mostly a function of the reduction in the participation rate which dipped.1% to 65.5%.
Revisions to the prior months showed a decline of approximately 26k jobs over the prior month. Over the past 12 months, the economy has added an average of 189,000 jobs a month, enough to slowly bring down the unemployment rate from its 8.2% level in July 2012 to the current 7.4% level. Private companies added 161,000 jobs in July, accounting for almost all of the month’s gains. This compares to the 200K that was reported earlier in the week by ADP.
The Nasdaq was the best performing major index pushing to new multi-year highs driven by Facebook and Apple. Momentum is gaining steam with the MACD pushing higher with a positive trajectory. The RSI (relative strength index) which is an oscillator that measures overbought and oversold levels is printing above 70 at 71 which is a warning sign of an oversold condition. Traders should be cognizant of a potential correction given the RSI reading.
Sorry. No data so far.