Your Weekly Market Blip 1/8/16

Your Weekly Market Blip 1/8/16

Stocks rallied, waffled and then fell as gurus pointed out that despite tensions in China, the US is not in a recession nor does it appear to be headed for one even though the energy sector is not doing ….”well”. The energy sector however makes up 12% of the S&P 500 Index and with gurus now lowering 2016 oil price estimates the hit to total earnings could cause stock levels to find a level commiserate with the expected lower profits.
At the close the Dow lost 167 points 16,346. The bright note was that trading volume was low. For the week the Dow lost 6%.
The United States added 292,000 jobs in December, well above expectations, and included an upward revision from the prior two months of 50,000 jobs. The Labor Department reported that for all of 2015 the US added 2.7 million jobs which was down from 3.1 million for 2014. The unemployment rate was unchanged at 5%. The service sector added 73k jobs, healthcare added 39k and construction added 45,000 and manufacturing added 8,.000. While this was a good report wage growth for the month was off slightly but still came in with a 2.5% gain for 2015.
The US energy industry continues to be caught up in the world oil feud between Iran, Saudi Arabia and Russia. Saudi Arabia is currently calling the shots amid a religious civil war in the Middle East. Its move to cut prices is hurting its revenue but it is also hurting Russia which appears to be on the side of Iran. Meanwhile US producers are under pressure and seem to be the only ones cutting back. How long this lasts is anyone’s guess. WTI crude today traded down a point to $32.80 a barrel. Wow that’s cheap! Running counter to oil, natural gas has rallied 20% over the past month thanks to demand from exports and home heating as weather turns colder on the east coast.
Boeing recorded a new record of commercial aircraft deliveries in 2015 of 762 up from 723 in 2014. The company had projected it would deliver between 750- 755 units so they did better than projected. I guess we can no longer refer to Boeing as the “lazy B” rather they are now the “busy B”.