Stock Markets Backtrack In Advance of February NFP Jobs Report

Editor's Note: Sincere apologies to readers for the incorrect posting this morning. February Non-farm payroll data will not be released until March 10, instead of the usual first Friday of the month. Money Daily reported below that the NFP data would be out TODAY, March 3, but that is not the case. We seriously regret the error.

Following Wednesday's massive upturn in markets on the heels of President Trump's speech, Thursday was a bit of a reality check for gamblers in the Wall Street Casino.

Smart one - and there were plenty of them - took their quick profits and are likely sitting in cash ahead of Friday's non-farm payroll report from the tarnished Bureau of Labor Statistics (BLS).

Since February is a short month, expectations for another bump in payrolls may very well be disappointed, to a degree not previously factored.

ADP reported fewer jobs created in the private sector for February than expected. The 139,000 American workers hired to private-sector payrolls in February was below economists' consensus forecast of 155,000. Additionally, ADP revised their January figure to 127,000 from 175,000. That's a mighty big decline which was overshadowed by Wednesday's shock and awe euphoria.

While the NFP does not exactly mirror ADP, it usually tracks pretty well, though the BLS is notorious for using metrics such as the business birth/death model to goose numbers toward the desired result.

Non-farm payroll data will be released Friday morning at 8:30 am ET. There may well be fireworks if the number falls short of the lowered-bar expectations of 157,000 net new jobs.

At The Close, 3.2.17:
Dow: 21,002.97, -112.58 (-0.53%)
NASDAQ: 5,861.22, -42.81 (-0.73%)
S&P 500: 2,381.92, -14.04 (-0.59%)
NYSE Composite: 11,575.91, -85.31 (-0.73%)

Trump Effect: Stocks Roar To New All-Time Highs Following Presidential Address

How important President Donald Trump's speech before a joint assembly on congress Tuesday night was is not easy to gauge, but, from a Wall Street perspective, he must have hit the high notes perfectly because all major averages were straight up at the opening bell and continued to add to gains throughout Wednesday's session.

The Dow, which blew away the 20,000 Rubicon less than a month ago, added nearly 1.5%, or 303 points, its largest one-day gain since early December. With Industrials leading the way, the other three major averages broke out as well, with the S&P pretty much reaching highs that analysts had been predicting as end-of-year results, yet we're barely two months into the new year.

How this kind of euphoria will eventually manifest itself is still a mystery, especially with stocks tacking higher despite consistent warnings of a valuation trap being set. While stocks continue to ramp on a daily basis, corporate reports are not following the same tune. Additionally, analysts from various houses also revised first quarter GDP estimates lower, with Goldman Sachs and the Atlanta Fed looking for 1.8% growth. JP Morgan and Bank of America are even more pessimistic, at 1.5% and 1.3%, respectively.

In the main, what companies behind the stocks are counting on is a relaxed regulatory environment under President Trump's administration. The President has already issued a variety of pro-business executive orders and his commitment to repealing and replacing the Affordable Care Act (Obamacare) is also being viewed as a positive on two fronts. First, it will free up consumer funds from an expensive mandated coverage nightmare; second, companies will probably get breaks as well in group coverage.

Adding to the speculative high spirits are items currently under the radar such as the President's budget, which includes massive cost-cutting across agencies, a one trillion dollar infrastruture plan that Mr. Trump touched on it in his speech, and trade negotiations with countries outside the framework of international treaties such as NAFTA, TPP and the World Bank.

All told, President Trump's first six weeks in office have been nothing short of miraculous for stocks, though it will take some time to see how it all plays out. Either stock pickers have been set up for a major catastrophe or the enthusiasm and honesty of the new president will indeed guide America and American business interests to new heights.

Lurking in the shadows behind the presidential bluster is the Federal Reserve, which meets in two weeks to decide whether to raise federal funds rates or keep them at current levels. Money is on them keeping the rates at the current 0.50-0.75, though even an increase of 25 basis points would seem to be inadequate to quiet Wall Street's enthusiasm.

At the Close, 3.1.17:
Dow: 21,115.55 +303.31 (1.46%)
NASDAQ: 5,904.03 +78.59 (1.35%)
S&P 500: 2,395.96, +32.32 (1.37%)
NYSE Composite: 11,661.22, +148.83 (1.29%)

Dow Winning Streak Ends At 12, Should Resume Promptly

Stocks ended a historic run of 12 straight winning sessions on the Dow Jones Industrial Average, tying the mark set in January of 1987, finishing the month of February on a dour note, though overall, stocks were fantastic for the month and so far in 2017.

With a possible March rate hike still two weeks away, there's still plenty of time to jump upon the Wall Street bandwagon. Since stocks apparently have no downside, more money will be pumped into the market by the almighty algos, probably beginning on March 1.

The old adage, "don't fight the tape," is in play as fundamentals have been tossed to the curb in favor of momentum-chasing. Stocks should continue to climb until they don't.

At The Close, 2.28.17:
Dow: 20,812.24, -25.20 (-0.12%)
NASDAQ: 5,825.44, -36.46 (-0.62%)
S&P 500: 2,363.64, -6.11 (-0.26%)
NYSE Composite: 11,512.39, -45.96 (-0.40%)

Coincidence Or Conspiracy? The Art Cashin - Fearless Rick Echo Chamber

Not one to expectantly toot one's own horn, Money Daily continues to display some market sense, the latest iteration being the confluence of the weekly market recap post from Sunday, February 26, Dow At Record Highs 11 Staight Sessions; Eye On PPT, Central Bank Intervention dovetailing with legendary floor trader Art Cashin's commentary at King World News the same day.

In the nearly 15-minute audio, Cashin, Director of Floor Operations for UBS, touched (near the end of the broadcast) on the very same subject matter as Money Daily, namely, central bank intervention in markets.

Like Fearless Editor and Publisher, Rick Gagliano, Cashin - undeniably a more expert analyst than our own - sees intervention as unsettling to markets, comparing the intrusion to a rigged poker game, and sees danger in such action. As is the usual case, Mr. Cashin plows some new ground as well, coining the phrase "intellectual civil war" in describing the conditions in Northern vs. Southern Italy and touching upon other established, mostly European nations.

In defense of his moderate style, Cashin opines that his success has been largely based upon, quoting him,

...because the first thing I do when I enter a room is look for the exit signs.

Good stuff, indeed, and well worth a listen.

Keeping in mind central bank intervention, i.e., buying at all-time highs, the Dow made a new record close for the 12th straight session, that, in itself, should be cause for alarm... the one that never goes off at market tops (Old Wall Street saying: "they never ring the bell at the top").

The Dow has never closed higher for 13 straight sessions, the most recent run tying the mark set in January 1987, which, as market observers know well, was the precursor of one of the most devastating crashes in market history.

At the Close, 2.27.17:
Dow: 20,837.44, +15.68 (0.08%)
NASDAQ: 5,861.90, +16.59 (0.28%)
S&P 500: 2,369.75, +2.41 (0.10%)
NYSE Composite: 11,558.35, +17.06 (0.15%)

Dow At Record Highs 11 Staight Sessions; Eye On PPT, Central Bank Intervention

As has been the case for multiple sessions over many years, a rally in the final hour of trading pushed the Dow Jones Industrial Average to a new all-time high, with the NASDAQ and S&P averages also closing up, but short of record highs. They NYSE Composite was fractionally lower.

In the red the entire session, the Dow gained 70 points from 3:00 to 4:00 pm ET, with other major averages also gaining. This kind of activity has been a market feature since at least 2001, when the existence of the Plunge Protection Team (PPT) turned from urban myth to global reality. The PPT, created by Presidential Order #12631, signed on March 18, 1988 by President Ronald Reagan is also known as The Working Group on Financial Markets, is, in reality, a body of financial authorities consisting of:

• The Secretary of the Treasury, or his or her designee (as Chairperson of the Working Group);
• The Chairperson of the Board of Governors of the Federal Reserve System, or his or her designee;
• The Chairperson of the Securities and Exchange Commission, or his or her designee; and
• The Chairperson of the Commodity Futures Trading Commission

Writers such as John Crudele of the New York Post have been critical of the Working Group's market-bending actions and foreign journalists from the Daily Telegraph and The Observer have suggested that the group has often exceeded its mandate.

Thus, tin-foil-hat type conspiracies have continued to suggest that the Federal Reserve and other central banks have been manipulating markets higher for years, and, while such coordinated action has yet to be unearthed by the mainstream media, sites such as ZeroHedge.com and other fringe outlets report that while the PPT may or may not be always active in markets, there's no doubt that central banks, notable, the European Central Bank (ECB), Swiss National Bank (SNB) and Bank of Japan (BOJ) are heavily invested in US and other global equities, making a mockery of the global regime of fiat money.

There are those who say intervention by government-sponsored agencies is not altogether nefarious, and some who believe such market-rigging is a good and reliable replacement for Adam Smith's "invisible hand" of the markets, it cannot be understated adequately that such activity will eventually undermine the integrity of financial markets and instruments.

Being based almost entirely upon faith and trust, financial markets have become the backbone of the global economy. If that faith and trust is broken - an unlikely occurrence, as the central banks, governments, and major brokerages work hand-in-hand largely toward the same end (higher stock prices) - the fragile system would crumble. An antecedent (and, much larger market) to the inner workings of financial markets is the bond market, which has also been pistol-whipped regularly by central bank policy and directive. On Friday, the US Treasury 10-Year Note fell to its lowest level in nearly three months, closing out the week at 2.3170, a direct result of higher stock prices, also known in the investing world as TINA (There Is No Alternative... to stocks).

With central banks and government agencies regularly interjecting themselves and their policies into financial markets, the natural question becomes: how stable and trustworthy are these markets and who gains from such manipulation?

Answering the question bluntly, the markets are only as stable as the institutions behind them, which is today a matter of considerable conjecture and discordant viewpoints. Purists posit that the mountains of debt produced by individuals, businesses, and governments is simply unsustainable and that a rout and crash, while unpredictable, is inevitable. The obvious conclusion to the other half of the question "qui bono" (who gains) is those in power and in control of such vast swaths of money, the governments, oligarchs, commercial and central banks. Beyond that, those in power consider themselves to be benefactors of the millions who gain from higher stock prices, inflation and boosts to massively underfunded pension funds.

With this degree of chutzpah in and on the minds of the central bankers and government leaders of the world, there is little doubt that they believe their actions to be highly beneficial to the orderly running of global finances while also not taking into account the falsity and pervasive inequities that are given rise by those same actions. Those with power over financial markets hold an incredible degree of responsibility, a responsibility that seemingly has gone beyond the pale, over the moon and into its own orbit.

Essentially, those who have questioned or taken positions contrary to the policies of the Fed and their brethren central banks, especially since the GFC of 2008, have been serially decimated in the markets. With stock indices raging without underlying fundamental bases, the planet may have reached a point of no return, wherein all matters financial are no longer in the control of individuals, but, rather, controlled by an opaque group of self-appointed masters.

One can only hope that they are well-grounded and essentially good-natured, because the alternatives would be brazen in concept and bizarre in execution.

At The Close, 2.24.17:
Dow: 20,821.76, +11.44 (0.05%)
NASDAQ: 5,845.31, +9.80 (0.17%)
S&P 500: 2,367.34, +3.53 (0.15%)
NYSE Composite: 11,541.29, -14.87 (-0.02%)

For the Week:
Dow: +197.71 (0.96%)
NASDAQ: +6.73 (0.12%)
S&P 500: +16.18 (0.69%)
NYSE Composite: +30.38 (0.26)