On the web since 1997
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On the web since 1997 |
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Walk On the Sunny SideLuke Hodgens / Powerhouse Profits -- Smile, all is not lost.Well, after the market took a severe beating on Thursday, it shook off the blow and got back in the ring. Unfortunately, the market took another knock out punch on Friday. After five consecutive days of winners, something bad was bound to happen. The slide began on Tuesday and snowballed into a huge loss for the week. The initial culprit was oil, but oil took a back seat to a less than spectacular jobs report. On Tuesday, oil futures breached the $44 mark sending shock waves through Wall Street. The market had, up to that point, been gaining ground despite oil's run from $40. Once that magical level of $44 was broken, stocks could no longer deny the truth: consumer spending will suffer. Wednesday gave some relief to the gas tank when oil slipped $1.32 per barrel. The market decided oil was going to head down and the Dow added a mere 6 points. The market was wrong. No sooner did oil drop over a dollar, buyers rushed back in and ran it up $1.58 the following day - stocks ran scared. On Thursday, the Dow lost a whopping 163 points. The bleeding was not over. Early morning stock futures were up on Friday - until 8:30 am. That was when the jobs report was released. Although oil shed 41 cents on Friday, a less than expected jobs report hammered stocks once again. The Labor Department reported that the U.S. economy added 32,000 non-farm payroll jobs in July. This is great news for 32,000 Americans, but poor news for millions of investors. The market was betting on approximately 215,000 jobs and was shocked at the real reading. The market opened significantly lower and shed throughout the day erasing all gains for 2004. We're now starting from scratch. But, dear reader, when it rains there is often a rainbow. Although the jobs report was weaker than expected, the unemployment rate dropped to the lowest level since October of 2001. The current unemployment rate is 5.5% or as us optimists like to say, the employment rate is 94.5%. Almost every capable worker has a job! Congratulations to all of you who found work in July. For the 5.5% of you who are out of work - keep up the hunt. Luke Hodgens is the editor of |
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