Your Weekly Market Blip 2/1/19

Your Weekly Market Blip 2/1/19

Stocks continue to trade higher with the Dow up 64 at 25,063. Trading volume was lower than whale dung. For the week the Dow was up about 1.3% or 322 points.

From Swoon to boon! While December was the worst month for stocks since 1931, January was the best month for stocks in over 30 years. Even the Fed is flummoxed. Jerome Powel is perplexed. He wants to back off on rate hike but economic data like todays labor report makes him sweat. For the month of January, the Dow is up 7.2% while the S&P 500 is up 7.9%.

The latest jobs report blew past estimates with 304,000 new jobs and an unemployment rate rising to 4% as the labor force participation rate rose like a balloon over the skies of New Mexico. People appear to be coming off the sidelines and getting back into the game. The gurus expected 158,000 new jobs. Wages were up 3% missing estimates calling for a rise of 3.2%. Looking inside the numbers however management/professionals saw a 2.5% rise in wages while trade/transport workers wages were up 3.4%, leisure/hospitality wages were up 4.1%, production/material wages were up 3.7% and sales wages were up 4.2%. In short, blue collar wages are rising faster than white collar. Here at Greystone we monitor several sources of information for nuggets of truth and lately it seems the power of the US consumer is being overlooked. Consumers drive 2/3rds of the economy and right now the consumer appears healthy. Debt levels are reasonable, wages are moving higher, gasoline prices are down and there are more job openings than applicants.

Amazon reported a 20% increase in revenue and a 181% jump in profits. Both top and bottom lines beat gurus estimates but shares fell due to the company lowering its forward guidance on plans for increased investments to grow the business.

GE, Exxon and Honeywell all reported better than expected results.