Stocks surged, then tanked, then erased those losses to basically break even for the day.
First, the scoreboard:
- Dow: 14,922.5, -14.9, -0.1%
- S&P 500: 1,655.1, +0.0, +0.0%
- NASDAQ: 3,660.0, +1.2, +0.0%
And now the top stories:
- The U.S. added just 169,000 jobs in August, which was less than the 180,000 expected by economists. To make matters worse, the July number was revised down to 104,000 from an earlier estimate of 162,000. Meanwhile, more Americans dropped out of the workforce, causing the labour force participation rate to fall to 63.2%, the lowest level since 1978. This helped cause the unemployment rate to fall to 7.3%.
- After the report hit, stocks, bonds and gold rallied. Some market watchers speculated that the weak jobs report reduced the likelihood that the Federal Reserve would begin to taper its monthly purchases of $US85 billion worth of Treasury and mortgage bonds.
- “All in, the disappointing headline payroll data, including the downward revisions to June and July, make our call for the FOMC to announce tapering at the September meeting a close call,” said UBS’s Kevin Cummins.
- But the majority of economists quickly reiterated their calls for the taper to begin in September. JPMorgan’s Michael Feroli argued aggressively: “One argument we have heard against tapering is the softness evident in the July jobs number, and to a lesser extent in August. It is statistical insanity to think that in any twelve-month period with job growth averaging 184,000 that each month’s outcome should be less than 80,000 away from that average, and even crazier to call 169,000 a disappointment relative to that average.”
- “Will we help Syria?” Putin asked rhetorically during the G20 summit. “Yes, we will. We’re doing it right now, we’re supplying arms.” These words shook the markets, causing the Dow to fall by more than 120 points in early trading. but the markets eventually erased all of those losses.
- Oil surged today. The price of the October crude oil futures contract settled at $US110.53 per barrel, the highest level since May 2011.
- Don’t Miss: The State Of American Jobs In 18 Charts »
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