Courtesy of John Nyaradi.
Index ETFs rose today after the release of an average Non-Farm Payrolls Report
Index ETFs rose in celebration today of a mediocre ADP Non-Farm Payrolls report. The SPDR S&P 500 ETF (NYSEARCA:SPY) rose .44%, the SPDR Dow Jones Industrial Average ETF (NYSEARCA:DIA) gained .32%, and the iShares Russell 2000 Index ETF (NYSEARCA:IWM) rose .74%. The only Index ETF that did not perform well today was the PowerShares QQQ Series 1 ETF (NASDAQ:QQQ), registering a .33% drop.
Today’s big news was the release of the mediocre ADP Non Farm Payrolls Report. The report indicated that the US Economy added 155,000 new jobs for the month of December, and indicated that the unemployment rate remained at a stubborn 7.8%, with 12.2 million people still not employed.
And, in their truest fashion, markets rose to yet another mediocre news event regarding our economy. The ADP Non-Farms payroll report has hovered around the 155,000 mark for a few months now, right along side the 7.8% unemployment rate. In light of the bogus fiscal cliff deal and the Fed’s “non-easing” remarks yesterday, it appears to me that nobody really knows how much longer this recovery will take or how it will turn out. Furthermore, the upcoming debt ceiling and sequestration debates will likely add nothing more than trauma and drama to the situation, especially in the event of a US default. Unfortunately, today’s numbers from the ADP Non-Farms Unemployment report show the “status quo” in our current state of affairs. And, oddly enough, markets are still rising.
At least today’s ISM Non-Manufacturing Index Report indicated a rise in non-manufacturing economic activity, with the index reading 56.1 in December as opposed to 54.7 in November.
From a technical level, the S&P 500 is still on a strong upswing, with a positive MACD of 3.546 and and RSI of 64.45. Both the MACD and the RSI are in strong bullish territory, especially after the heroic gains this past week. Perhaps Santa Claus flew late, but seasonally speaking, if the January Signposts check out, we are looking at a positive year. With the first three trading days of the New Year over, time will only tell.
Bottom Line: Markets seemed happy about the rather mediocre/average ADP Non-Farm Payrolls report released today. With the first few days of January finishing in bullish territory, we might be looking at a good year, seasonally speaking. However with the fights ahead in Congress, things might get ugly in the short term.
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