Friday, September 4, 2009

Markets Refuse to Buckle

Though just about everybody waited until Friday morning's release of non-farm payroll data from the Labor Dept., the anticipation was overblown as the numbers came in better than expected and were presaged by Wednesday's ADP private payroll report.

The Labor Department reported a loss of 216,000 jobs in August, the lowest level in 12 months. The unemployment rate ticked up to 9.7%, though that didn't seem to bother investors as stocks made gradual gains through the first four hours of trading and then leveled off into the close, prior to the long holiday weekend. Markets are closed Monday in observance of Labor Day.

Dow 9,441.27, +96.66 (1.03%)
NASDAQ 2,018.78, +35.58 (1.79%)
S&P 500 1,016.40, +13.16 (1.31%)
NYSE Composite 6,637.13, +90.53 (1.38%)

Even though volume was extremely light, stocks still ramped up across the board. Advancers beat back decliners, 4937-1455. There were 152 new highs and just 39 new lows, indicating that not only has the much-ballyhooed "correction" not taken place, it may be replaced by a continuation of the 6-month-old rally that continues to arch toward a full-blown bull market.

NYSE Volume 1,154,949,000
NASDAQ Volume 1,743,171,000

In the commodity markets, the metals relaxed following huge price gains this week. Gold was down $1.00, to $$996.70, while silver shed a penny, to close the week at $16.29. Crude oil for October delivery gained just 6 cents, to finish at $68.02.

When all was said and done, stocks gained back almost all of the losses suffered on Tuesday and appear to have stabilized into a consolidated trading range. The next move, unless some economic data appears to contradict recent reports, should be again to the upside. The short breather over the past two weeks has given traders time to take profits, rotate into other secotrs and stake out new positions.

September, usually a dour month, may turn out to be something much better than expected. Stocks are only down marginally and the charts seem to be indicating another surge to the upside is in short order.

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