7/7/11…waiting for payrolls

Bloomberg Top Stories:

*Trichet Says Monetary Policy Remains Accomodative After Key Rate Raised

*Initial Jobless Claims in U.S. Decreased 14,000 Last Week to 418,000

*Stocks, Commodities Rise After U.S. Job Report; European Debt Risk Climbs

*Downgrades in Portugal, Ireland Spark Rally, No. 1 Bond Investor Says

*Hedge Funds Move Past Greece With Bets That Sovereign-Debt Crisis Expands

*Goldman, Morgan Stanley Stay Bullish on Oil, Copper as Economy to Recover

*Coal is Poised for Worst Quarter This year on China, Japan

*Dimon-Bernanke Faceoff Shows Frustration Over Regulation Amid Kahn Regrets

*Squeezed Irish Implored to Replace Old Fridges as Economy Craves Spending

*Obama Administration Seeking Tax Revenue Increase in U.S. Debt-Limit Talks

*Republican Fundraising Shows Slow Start for 2012 Presidential Election

Volume was steady at 3.3B shares while Big Board volume dropped to 821 million shares, second lowest since 6/24. Volume crossed 600 million just 10 minutes prior to the close. Meanwhile the VIX still says ‘no problem’ as it closed at 16.34, up only slightly from Friday’s 15.87 (lowest since April 30th!).

The two Nasdaq indices rose 0.3% and Russell 2000 +0.4% in choppy trading yesterday, while the S&P 500 was the laggard spending most of the day down slightly and closing +0.1%. Dow +0.5%,Transports +1.2% vs -0.9% following Friday’s huge 2.3% gain; New 52 week highs dipped slightly to 311 vs. 330 while new lows rose slightly to 48 vs 36. Advance/Declines ran +1.2x on the NYSE and Nasdaq, while Breadth was -1.1:1 on NYSE and +1.1:1 on Nasdaq. Stay tuned for payrolls on Friday, followed by options expiry the next Friday.

…stocks opening stronger on the decline in weekly jobless claims to 418k – target for bulls is <400k. But most companies having cut drastically and now cautiously adding workers remain skeptical. As for continuing and emergency claims, of course they are falling but irregularly despite massive expiration of benefits. Can this be a good sign.

Do you really believe Greece can be saved? How can it is a better question…and if Greece goes, Ireland, Portugal and even Spain are at risk and the hedge funds seem to believe that the EU’s efforts are only a band-aid on a wound that will eventually require amputation.

Forecast is for about 90k new jobs while the ADP survey today came in at 157k vs consensus 70k. Still, this is a far cry from the 400k we need each month to get us back on track…quite a reason for a stock rally, no?

. . .  – – –  . . .    . . .  – – –  . . .

TB wishes we lived in a country where our elected leaders could act like adults and not thrash opposing views with such vehemence that they polarize the electorate and thus box themselves into a corner and are unable to find balance through compromise. Is that asking too much of them for what they are paid?

Have a nice day!



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