Thursday, August 31, 2006

More Signs of Steady Job Growth, Low Inflation

The markets are mixed in early trading. The retail sales reports were released this morning for August and were basically a mixed bag. I will show some of the highlights in my next post.

Oil and gas prices are lower again today, which was weighing on the energy stocks, but they seem to be bouncing as I write.

The Monster Employment Index showed a strong rebound in August, rising 8 points to 173. This is indicative of further, steady job growth, especially in terms on online recruitment.

The core PCE inflation reading came in lower than expected this morning, and that has bond prices rallying and yields falling again. The 10-year yield is now down to 5-month lows at 4.74%. This is more than 50 basis points below the fed funds rate, and increasing the odds of recession. Those who think the Fed will raise again should stop smoking.

Also, Japan released some economic data that showed a slowing of its economy. If the BoJ stops raising rates, that could cause some to put back on the yen carry trade, and help global markets.


At 8:51 AM, Blogger Kevin Shuller said...

I'm thinking that PSUN has put in a floor here. Macroeconomic factors notwithstanding, this morning's comps were absolutely horrible (-9.4% vs -4.6% est) and the stock is up. When news is that bad and the stock holds up, the weak hands are out and the stock should hold. Also, we had a huge capitulation event a few weeks ago. Thank god, it's been making me nauseous for months.



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