Major Market Movers

Good Report?!!

Don't you just hate it when you place bets knowing that there are only two ways to go and you later find out that there is secret option number 3? Job's report was a complete disappointment for both the bears and bulls as the reading was straight in the center.
The US released the Non-Farm Payrolls for the month of November showing the economy added 94K jobs higher than the expected expansion of 80K however it is still lower than the previous job report of 166K in which it was revised to 170K. Also released was the Unemployment Rate for the month of November unchanged at 4.7% inline with the previous yet slightly lower than the forecasts of 4.8%. Finally, the Average Hourly Earnings for the month of November show an 0.5% rise higher than the forecasted and the previous figures of 0.3% and 0.2% respectively.The labor report showed that additions in the labor market was led by the services sector, which added 127,000 jobs, somewhat limited the risk of a severe economic slowdown which could've resulted into a recession. Strength was also seen in the government sector as it increased by 30,000 and the retail sector which added 24,000. Those sectors were able to offset the ongoing pattern in construction and manufacturing job losses and also the financial services sector. Goods-producing industries cut 33,000 jobs in November; 24,000 in construction and 11,000 in manufacturing.Surprisingly, a separate survey concerning the household sector showed the strongest job growth in six years as 696,000 people said they had jobs in November which resulted for the unchanged employment rates at 4.7%. This was shocking since employment had fallen by a total of 250,000 since March.The White house was the first to comment on the job's report as White House spokesman Tony Frato said that it was "certainly good news" and the fact that unemployment was unchanged at 4.7% "bodes well for the economy."Markets reacted instantly as the news was released showing that the dollar gained against majors but it was just a matter of minutes before markets rebounded and reversed to return to normal levels.In another report, the U.S. released University of Michigan Confidence preliminary reading for the month of December coming in at 74.5 lower than the forecasted reading of 75.0 and previous reading of 76.1 making it hit its lowest levels since fall of 2005. Confidence seems to have slipped in the economy and its affect might soon emerge.It's already expected that the Feds will cut rates but the question was whether it will b by 25 bp or 50 bp? However, now after the jobs report came in better than expected, markets might now lock a 25 basis point cut taking their benchmark interest rate to an overall to 4.25%. Arguments now are taken to a new level as they debate the fact on how many rate cuts are still to come. One of the Feds main concern is the fact that they are worried that banks don't want to borrow from them because they are worried and that it would recognized as a failing bank.Dear reader, relax during the weekend and don't stress yourself as four days remain before the Fed's decision. Enjoy your time and challenge yourself with a little game, place a bet on the rate decision and who knows? Maybe you're a good analyst yourself…