Job gains spark stock rallyWells Fargo Daily Advantage – 12-6-2013
A stronger-than-expected employment report sparked a rally in the major stock indexes. The Dow gained 198 points, the Nasdaq rose by 29, and the S&P 500 Index advanced 20. All of the Dow's 30 components gained ground, led by Intel (INTC), which rose more than 2%. Volume was light, and advancing issues outnumbered decliners by about seven to three on the NYSE and about two to one on the Nasdaq. The prices of Treasuries weakened, while gold futures slipped lower by 0.2% to $1,229.00 an ounce. The price of crude oil on the New York Mercantile Exchange gained 0.2% to $97.65 a barrel.
In Other Business News:
- The nation's nonfarm payrolls expanded by 203,000 jobs in November, according to the Labor Department. The expansion was larger than most experts were expecting. At the same time, the unemployment rate fell from 7.3% in October to 7.0% last month, which is the lowest level since November 2008. Overall, the jobs report was seen as a sign that the economy is gaining strength, but some observers also pointed out that the decline in the unemployment rate may have resulted, in part, from the return to work of federal employees who were laid off during the government shutdown in October.
- According to press reports, Democratic and Republican negotiators on Capitol Hill are nearing an agreement on a new federal budget. If the deal is reached, it would mean that yet another knock-down drag-out fight over the budgetalong with another possible government shutdownwould be averted from the expected showdown in January until after the midterm elections of 2014.
- Sears Holdings filed with the Securities and Exchange Commission to spin off its Land's End brand as a separate company. Sears has tried to sell Land's End to private equity firms with little success, according to The Wall Street Journal.
- Consumer morale has picked up notably in December following the gloom generated by the government shutdown in October. According to the University of Michigan, the Consumer Sentiment Index jumped from 75 at the end of November to 82 in the preliminary reading this month.
What a great year for dogs. Now mind you, I like being who I am, but if I couldn't be a human, I'd be a dog. Consider the following evidence:
1. A professor at the University of British Columbia reports that the average dog has the mental abilities of a two-year-old human. Canines can learn up to 165 words, about the same as a two-year-old child, and the average dog is moderately better at arithmetic. (Wow, and since 38% of children under the age of two are now using digital media for about 15 minutes a day, this means that if I die and come back as a dog, I can keep my iPhone.)
2. This year, dogs got their first dedicated television programming on a cable station called DOGTV, which is broadcast by DIRECTV. Programming includes such things as music and animated programming that appeals to the Fidos of the world. (Uh-oh, not another Lassie rerun! Beware couch potooches.)
3. A study by Spectrem Group this year found that 58% of wealthy pet owners have dogs and only 37% have cats. (Another 3% have fish, 2% own birds, and 2% have horses.) Moreover, a trust attorney with the law firm of Genser, Dubow, Genser & Cona in New York reports that 90% of pet trust funds are created to support dogs and only 10% are for cats. Why would wealthy people favor dogs over cats? Dogs offer "unconditional love and you don't get that from a cat," says the attorney. With dogs, "its unbiased love and money doesn't enter into the equation." (If I die and come back as a dog, I'll find a wealthy master and then we'll see about that.)
Have a great weekend. (Arf, arf.)
The opinions stated are those of the author and are not intended to be used as investment advice. The views are subject to change at any time in response to changing circumstances in the market and are not intended to predict or guarantee the future performance of any individual security, market sector or the markets generally, or any mutual fund.