December 3, 2013
This is Mark Vickery covering for Sheraz Mian, who will be away
on business until the second week of December.
With the initial surge of holiday retail season receding in the
rear-view, focus now changes to November employment numbers.
Wednesday's ADP private sector report will be followed by
Friday's Bureau of Labor Statistics (BLS) non-farm payroll
The year 2013 has been quite decent for the jobs market overall.
Unemployment has fallen from 7.9% in January of this year to 7.2%
in September, then 7.3% in last month's report. (Remember it
wasn't all that long ago -- October 2009 -- that we saw
unemployment hit 10%.) Hopefully, with federal government issues
like The Shutdown also in our rearview mirror, we'll see a "pure"
jobs report, free of any dysfunctional static.
Expectations are for roughly 180,000 new jobs created in the
previous month. This is down from the previous 3-month average of
202,000, so feel free to consider the possibilities of a positive
Holiday season is always better for employment, generally, with
seasonal employees manning the retail shops while customers go
bonkers trying to buy gifts for their loved ones (and themselves)
at attractive discount prices. But perhaps that will manifest
itself in the employment figures for December (next month's
report) than this week's.
And if we do happen to see better-than-expected employment
numbers, its implied positive impact on the economy would
naturally lead analysts to conclude the Federal Reserve's
tapering policy may move closer to the front burner. And while
tapering is unlikely during the remainder of Ben Bernanke's
tenure as Fed Chair, the spotlight moves straight to Janet
Yellen, the question not being "if" but "when."
Of course, that brings about this rare conundrum our market has
been experiencing of late: a more-rapidly improving economy
actually puts a damper on market futures, as the "free lunch" of
the tapering program would finally expect companies to earn
profits on their own. This would add uncertainty to the market,
and we all know how much the market loves uncertainty. Then
again, it's got to happen sometime for the health of our economy
to improve, so…
In any case, though 2013 was ultimately a mildly positive one
overall for investors (who hadn't bought
] in 2012 and sold in the first week of October), there are
plenty of reason to feel 2014 will be even better. A continued
strengthening in employment, and therefore the economy, will do a
great deal to heighten investors' expectations further.
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