There is quite a bit of debate this morning over the meaning of the monthly jobs report. The nonfarm payroll number was about 40,000 under expectations but hourly earnings were better than expected and the ratio of U.S. employment to the population is at the highest level since December 2008.
The main issue of debate is whether slowing in employment growth is a function of an economy that is already near full employment and does not have as many 'quality' candidates or is an indication that issues like the China trade war is causing employers to hold back?
The market is accepting the positive spin for now as Larry Kudlow makes the rounds selling the numbers like a salesman with a 'sweet' 2006 Chevy Impala he wants to move. Larry is also upbeat about China trade and that is helping sentiment as well.
Jerome Powell is giving a speech in Switzerland around 12.30 pm ET but it will be surprising if he says anything very surprising with the Fed meeting less than two weeks ago. Market players will be looking for a headline they can react to but it is likely to cause just some short term volatility rather than a sustained move.
The indices are holding on to gains with breadth running about 4 to 3 positive. There are only about 130 new 12-month highs so far which illustrates the limited pockets of momentum. The action is positive but not very energetic.
I'm looking for some new buys and haven't done much so far. Snap, Inc (SNAP) , which is sitting at its 50-day simple moving average, is of interest but I will wait until after the Powell speech for doing much.