The Monthly employment report on Friday morning put a positive slant on the S&P futures and the US Dollar but gold was already correcting in European and pre market trading. Sure enough, when the market opened stock indexes popped and quickly put in their highs for the day and then faded into the close. Downside momentum picked up significantly in the last two hours of trading.
What changed the mood of the market? I'll be addressing this in my analysis.
Stocks, on average, finished the week flat with the notable exception being the S&P 400 Mid Cap Index which surged 1.34% on the week and that was even after Friday's sell off:
So is the official data right? As I've stated before, no one really knows what's going on in China. Like elsewhere on the planet, financial markets are hopeful that the new regime, set to take over this week, will provide more stimulus to a moribund economy. For reasons that would take too long to articulate here, I don't believe the Chinese government will provide the amount of stimulus the street is expecting and so the financial markets are setting themselves up for disappointment.
We may be exposed by a "double whammy" on Wednesday if the Greek Parliament does not ratify the austerity measures the Samaris coalition government negotiated with the Troika. If that were the case, this event would override any news about the US election and stocks would sell off. At the time of this writing, reports out of Greece speculate the coalition has enough votes to approve the austerity package by a count of four.
As always, there are a lot of moving parts to next week's market action and it's never simple.
NOTHING IN THIS COMMENTARY SHOULD BE CONSTRUED AS AN OFFER OR ADVICE TO BUY OR SELL ANY SECURITIES, OPTIONS, FUTURES OR COMMODITIES. THE OPINIONS ARTICULATED ARE ONLY THIS AUTHOR'S WHO IS NOT A REGISTERED INVESTMENT ADVISOR OR BROKER ... yet!