Switzer on Saturday

Could money market pessimism be overdone as US jobs surge?

Founder and Publisher of the Switzer Super Report
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Friday Close
Change
Change %
Week Change %
Dow Jones
26,922.12
-43.88
-0.16%
1.21%
S&P 500
2,990.41
-5.41
-0.18%
1.65%
NASDAQ
8,161.79
-8.44
-0.10%
1.94%
ASX 200
6,751.30
33.30
0.50%
2.00%
Data for week commencing 01 July 2019

Wall Street got itself caught in a dilemma where the professional players had to work out what was more valuable to them - a better-than-expected economy or an interest rate cut? To me, there’s no choice - a stronger economy producing more jobs than expected, which should improve company profits over time, is the better option. After all, the Fed would lower rates to achieve exactly that, wouldn’t it?

Showing you how deceptive an economy can be, the Yanks saw 224,000 jobs created in June, compared to a consensus guess by economists of 165,000. And this unexpected big number follow’s May’s astoundingly low 75,000 result. That was a huge turnaround!