1:10pm (EST)
The bulls have gotten off to a quick start for the second quarter as the market opened higher and is holding its gains. Futures were pointing towards a big open after seeing the overseas markets trade higher but the bulls got some encouraging economic news that has put them in a buying mood.
The Labor Department reported initial claims for jobless benefits fell by 6,000 to 439,000 last week. The previous week’s level was revised upward to 445,000 from 442,000 versus expectations of 440,000. The four-week moving average went down by 6,750 to 447,250 from the previous week’s revised average of 454,000.
The weekly report provided some reassurance following yesterday’s ADP report which unexpectedly said employers cut private-sector jobs last month. Of course, all eyes will be on Friday’s non-farm payroll report which is scheduled to be released at 8:30am (EST). The stock market will be closed so we won’t get a good read on the market’s reaction until Monday although the futures market could give us clues.
Economists predict the Labor Department will say employers added 190,000 jobs last month, which would be only the second month of jobs growth since the recession began. There are higher estimates but if this number doesn’t come in at triple figures then the market could be in trouble.
In other economic news, the ISM manufacturing index came in at 59.6 in March, above 56.5 in February. A number above 50 indicated growth and expectations were for a print of 57.
The bulls have recouped yesterday’s losses and today’s close will be important. The Dow is easily within striking distance of 11,000 and is currently trading at 10,924 – up 67 points, or 0.6%. We doubt we get to 11,000 today but we would like to see 10,900 hold. Not that it would make much difference if a correction is coming but if we can hold key technical levels would help.
The S&P 500 is enjoying a 9 point pop, or 0.8%, and is at 1,178 while the Nasdaq is up a perfect 10 and is at 2,408.
We have a lot to cover in our Members Area so we have got to go. We will try to send out an update on Friday morning but we are planning to release the Weekly Wrap on Saturday this week instead of Sunday.
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