Today's Comments (Short Term Outlook)                             Printer friendly

Can the jobs report help? After rallying strongly early yesterday, stocks could not hold on to their gains and ended the day mixed.  The S&P 500 (C fund) was flat, the small caps (S fund) were down quite a bit, and the I-fund managed a fair gain as the dollar continued to its reversal to the downside. The chart continues to breakdown and December's low of 1435 is the next hope for support.                                      Chart provided courtesy of www.decisionpoint.com   The market will now rely on today's jobs report for some relief.  It is one of those situations where we don't really know what the market wants to hear.  A very strong report will be a good sign for the economy, but it will decrease the odds of a 0.50% rate cut by the Fed at their next meeting.  A jobs report that is too week is bad news for the economy and will intensify the talk of a recession, but increases the chances of a 0.50% cut.  A 0.25% rate cut is basically a given at this point.  The estimates are for just 70,000 new jobs. Sentiment is overly bearish which could give the market some cushion, but at the moment, that is the only good news.  The TSP Talk sentiment survey came in at 35% bulls, 53% bears for a 0.66 to 1 bulls to bears ratio.  This keeps the system on a buy signal for next week and I would have to concur that we should see at least a temporary pop to the upside in the averages sometime in the next week.  But it could get worse before it gets there.                            The AAII Investor Sentiment Survey came in even more overly bearish (bullish for stocks) with a  bulls (26%) to bears (55%) ratio of 0.47 to 1.  As I mentioned yesterday, the Investor's Intelligence Advisor Survey continues to tell a different story, just to confuse us. The Japanese Nikkei was down over 4% last I checked (Thursday night).  That is not a good start for the I-fund today, but the jobs report will influence the European markets greatly.     That's all for today.  Let's let the jobs report do it's thing and then forget about it and enjoy your weekend.  See you Monday. Have questions?  Visit our message board for answers.  Would you like to be on our email alert list?  We will send you an email when there is a change to our asset allocation or market outlook.  Your email address will never be given out.  Read our privacy policy.  By signing up you agree to the TSP Talk Terms of Service.  More details below **. Are you bullish or bearish?  Join the Weekly Sentiment Survey. Like what you're reading?  Tell a Friend about us.