The Main Event today is the June NFP and employment report 1 day early as US markets and government offices are closed Friday.
Consensus is for non farm payrolls to have increased +230K. Recall that the +280K May was a “beat” and revisions for the 2 prior months will also get some attention.
Average Hourly Earnings will be a be a big focus. In May AHE ticked up +0.3% from an anemic +0.1% in April. Aggregate earnings also showed significant improvement in May +0.5% from +0.3% in April. It may seem like splitting hairs, but annualized, that’s +3.6% and +6.0% respectively, and similar readings for June would go a long way toward “nudging” the moderates on the FOMC to endorse a September rate hike.
Earlier in the year the FED cited worries over the “slack” in the Labor force numerous times as an obstacle toward achieving their 2.0% inflation target, and continued improvement on the earnings front will be a big factor in their discussions on timing the initial rate hike.
Wednesday market recap: Equity markets had a decent follow through day from Tuesdays moderate bounce, as they are still in “repair mode” following the bludgeoning they took on Monday. The DJIA, S&P500, and NASDAQ were all +0.5% to +0.75% higher at the end of the day, although well off their morning highs of the day.
The Russell 2000 was a notable laggard with only a +0.2% gain.
Market Internals were almost identical to Tuesday with advancing issues beating decliners 5 to 3 on the NYSE, while it is somewhat bothersome that the a/d on NASDAQ was just fractionally better than even.
Oil was down 3% as it continues to find significant resistance at $60 on the NYMEX contract, and correspondingly most oil related issues were lower on the day.
Transports did hold onto a fractional gain, DJ Transports +0.15% at 8104, holding the 8100 level on the close.
Transports had been much higher earlier in the day before news broke that the DOJ was investigating the Airline Industry for price collusion. You’ve got to be kidding me!!
Is this the same government that green lighted 2 mega mergers in the Airline industry in the last few years!!!
And the preposterous notion that there might me price collusion in the Airline Industry!!! Anyone who flies on occasion knows there’s a major price gap between coach and first class.
On that note, I’m saving Greece for later
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