Huh? Why are we so strong today? It's been a straight line across for the major indices today...not even a hint of a selloff.
Yes, oil holding around $100 is a positive....yes, the lower dollar is helping multinational companies...yes, there is big money coming out of the Middle East, and finding its way into the United States...but the biggest single factor is hope that the jobs market is finally turning around.
Job growth (along with housing) is the Missing Link of the economic recovery...but with a better ADP report yesterday, and improving initial jobless claims there is now a solid hope that nonfarm payroll reports--out tomorrow--can get over the elusive 200,000 mark and stay there.
Our own Steve Liesman has noted the improving trends today: jobless claims at a 2.5 year low, along with ISM services report at a 5.5 year low.
Unfortunately, the market is now clearly pricing in an above-200,000 jobs report, which sets us up for the possibility that should we get a better number, the market will either: do nothing, or sell off on profit taking, because the rally occurred today.
What can break this uptrend? A nasty headline on Saudi Arabia, for sure. But for the moment, traders have their eyes on the improving U.S. economy.
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