Flat open after jobs report
U.S. stocks are expected to open near steady levels after a dreary employment report that wasn’t as bad as feared, but which still generated a pullback in the U.S. dollar and a rise in the gold market. Stock index futures saw a modest bounce as non-farm payroll declines were not as bad as the “whisper” numbers. The Dow is expected to open about 20 points higher, while the Russell 2000 (NYSE:IWM) was called up about 0.2%, near 503.00.
The employment report headline figure showed that 524,000 non-farm jobs were lost in December, which was in line with the average analyst guess of 525,000, but well below whisper numbers ranging above 650,000 after the ADP private employment survey earlier this week was at 693,000. The unemployment rate climbed to 7.2%, which was well above the forecast.
In overseas trading, markets in Europe were slightly lower in front of the U.S. employment release, while Asian markets posted moderate losses. South Korea slashed rates overnight, bringing their repurchase rate to a record low.
Japan’s Nissan tumbled 5%, while bank stocks in Europe were under serious pressure. Commerzbank, Germany’s second-largest bank has seen a 2-day hit approaching 20% losses. Meanwhile, French bank Natixis tumbled 9%.
The chart picture continues in a sideway consolidation pattern and the market needs a decisive push above 514.50, or below 491 to suggest a breakout move is at hand. How the market trades today through the jobs interpretation will be key for shaping the weekly chart studies.
