Stocks rebound on weak jobs report


Stocks are about flat this morning after cutting losses as job growth lagged estimates.
S&P 500 futures are slightly positive, rebounding from a decline of more than 0.3 percent earlier. Europe is fractionally lower, and Asian markets were mixed overnight.

The Labor Department reported that 142,000 jobs were added last month, well below the 223,000 forecast by economists. The miss reduced fears that interest rates will increase in the near term. Unemployment fell to 6.1 percent as expected. The S&P 500 has been churning around record highs for more than a week following a quick rally in August, so the bigger question may be whether a pullback is needed before expecting a breakout.
Developments across the Atlantic are also gaining importance after unprecedented stimulus measures by the European Central Bank yesterday drove the euro to its lowest level against the U.S. dollar in more than a year. Its rapid descent could make investors fear a negative impact on corporate earnings given that many companies have significant operations in Europe.

The calendar slows following today's job report. Next week's big events are Apple's expected launch of the iPhone 6 on Tuesday and retail sales on Friday.

Sentiment has been mixed recently, with some economically sensitive sectors such as transportation and retail outperforming. Oil and gas companies, however, have lost their leadership and are now the worst-performing group in the last month. Our researchLAB market scanner also shows investors moving into new areas including solar energy, Latin American banks and widening their interest in semiconductor names. Financials have started to gain positive momentum as well.

In company-specific news, semiconductor company Ambarella is indicated up 7 percent after releasing better-than-expected earnings and revenue. El Pollo Loco also gained 4 percent on a strong quarterly report. Finisar declined 6 percent on weak sales and guidance. Apple is also up almost 1 percent after pulling back in the last two sessions.

The euro and oil, which have both fallen together in recent months, are fractionally higher this morning. Copper is also eking out a small gain and precious metals are down slightly.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.

This article appears in: Investing , Options

Referenced Stocks: SPX



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