The old wall street adage “The trend is your friend” is certainly ringing true in the stock market so far this year and now the job market apparently is beginning its own trend. February’s jobs report announced yesterday was once again better than expected. Although the headline unemployment rate remained at 8.3%, the economy welcomed in 227,000 new jobs. This is the third month in a row that payrolls have increased by over 200,000.
Once again traders and investors are embracing the signs of a stronger economy which is buoying the stock market. Just as the markets appeared to be headed for their first meaningful pullback of the year earlier this week, the bulls stepped into stocks on Wednesday providing a floor and sending equities higher the rest of the week. Most of the key indices were up on the week with the Dow Jones Industrial Average (chart) finishing slightly in the red off 0.43%. The S&P 500 (chart) notched a slight gain of 0.09%, the Nasdaq (chart) +0.41% and the small-cap index Russell 2000 (chart) lead the way posting a 1.82% gain.
Tuesday’s triple digit loss for the Dow Jones Industrial Average (chart) could of easily unnerved the bulls and gave the bears hope that the much anticipated sell-off had begun. However, once again equities demonstrated their undeniable resilience and continues to find support with any attempt of a pullback or sell-off. Although the bears argue that volumes remain light, there is no denying that this is one of the most powerful trends to the upside that the markets have seen in years.
Have a great weekend 🙂