Friday, August 7, 2009
Ending the Week on Good (Less Bad ) News!
It is 5:20 AM., I just poured a strong cup and the jobs report will announce in just a few minutes. Be right back.
10-4 good buddies, we have a better than expected report! Although we have 19-months of jobs loss, it is the smallest loss since last August. The Labor Department says nonfarm payrolls declined by 247,000 in July versus an expected 350,000. They also revised their numbers with a net 43,000 fewer jobs lost earlier this year. Unemployment surprisingly dropped from 9.5% in June to 9.4% in July. Payroll cuts slowed in a variety of industries including manufacturing and many services while the automobile sector posted a rare increase, as anticipated seasonal layoffs failed to materialize (Go cash for clunkers).
Reactions from some of the CNBC business news guests are noteworthy. Mesirow Financial's Chief Economist, Diane Swonk exuded, "...wonderfully pleased!" Other eco-luminaries exclaimed in the wee morning hours, "the economy has clearly turned", "...back from Armageddon", "...a turning of the animal spirits."
OK, enough already. What does this really mean? Folks (except economists) are still losing their jobs. The true recovery test will be the gap between when companies stop laying off and start hiring. The Colonel is not one to ignore a ray of light in the mineshaft, so I'll agree that this morning's news is at least pointing in a good direction. The dollar strengthened, T-Bill yields jumped, silver popped to nearly $15 in London and the markets have opened on an upbeat note. Below is a 15-day chart of our four favorite metals, we've a come a long way in a short time. That's worth at least one Big Friday Yee-ha!
Enough talk, let's walk the walk:
Oil is down $0.50 to $71.44 in early trading (September contract); Gold is up $0.8 to $963.7 (December contract, most active); Silver is up $0.190 to $14.835 (September contract); Copper is up 0.0365 to $2.7885 (September contract); Molybdenum is chilling at $18.25.
The DOW is up 62.27 points to 9318.53; the S&P 500, up 7.98 points to 1005.06. The miners are mixed today:
Barrick (ABX) $35.31 down 1.23%
Newmont (NEM) $41.95 down 0.87%
General Moly (Eureka Moly, LLC) (GMO) $2.79 up 1.60%
Freeport McMoran (FCX) $63.70 down 0.45% (a bellwether mining stock spanning gold, copper & molybdenum)
Steel stocks are up today, (a "tell" for General Moly):
Nucor (NUE) $49.03 up 0.41% - domestic steel manufacturing
ArcelorMittal (MT) $37.68 up 1.40% - global steel producer
POSCO (PKX) $103.00 up 1.43%- South Korean integrated steel producer
The Eureka Miner's Grubstake Portfolio is up 0.28% to $1,133,863.13