Before the Open (Oct 3)

Good morning. Happy Friday. Happy Employment Numbers Day.
The Asian/Pacific markets closed mixed. Taiwan rallied 1.5%; Hong Kong and Singapore also did well. Indonesia dropped 1%. Europe currently leans to the upside. Amsterdam is up 1.1%, followed by Spain and London (up 1% each), Stockholm (up 0.9%), Austria (up 0.85%) and Russia and Italy (up 0.7%). Greece is down 1%. Futures here in the States point towards a big gap up open for the cash market.

The dollar is up. Oil is down, copper up. Gold and silver are down.
Here are the employment numbers…
unemployment rate: 5.9% (was 6.1% last month)
nonfarm payrolls: +248K
private payrolls:
average workweek: up 0.1 hours to 34.6 hours
hourly wages: down 1 cent to $24.53
labor participation rate
employment gains in August revised up to 180K (from 142K).
employment gains in July revised up to 243K (from 212K)
The market’s reaction to the news has been positive. S&P futures jumped a couple points, so the day will start with an attempt to continue yesterday’s rally.
My first S&P 500 target has been hit. Here’s the chart.

For those who have short term memories, this has happened many times. The market drops, everyone gets super bearish, everyone believes a top is in place…and then after what turns out to be a very shallow move down, the market bounces and instead of it being a bounce within a downtrend or a dead-cat bounce, it keeps going and going and going. Look no further than the chart above to see how many times it’s happened in just the last year.
Am I predicting this? No. I’m just reminding you before you get too excited about the prospect of shorting this bounce. If the market doesn’t make sense, get used to it. It can not make sense for a long time.
The small caps are lagging big time; this will need to change if the market is going to sustain a rally.
Many technical indicators will need to reverse and lend evidence to improved conditions.
The market can and will do whatever it wants. Our job is to gauge the support and therefore likelihood it can continue.
Have a plan. Execute.
Stock headlines from barchart.com…
JetBlue (JBLU +3.42%) was added to the short-term buy list at Deutsche Bank.
Cree (CREE -12.04%) was downgraded to ‘Hold’ from ‘Buy’ at Needham.
Vale (VALE +2.12%) was downgraded to ‘Hold’ from ‘Buy’ at Canaccord.
Abercrombie & Fitch (ANF +0.06%) was upgraded to ‘Equal Weight’ from ‘Underweight’ at Barclays.
Halliburton (HAL -1.65%) was upgraded to ‘Equal Weight’ from ‘Underweight’ at Morgan Stanley.
SunPower (SPWR -0.06%) was upgraded to ‘Overweight’ from ‘Neutral’ at JPMorgan Chase.
Brahman Capital reported a 5.24% passive stake in Calpine (CPN -1.79%) .
Salesforce.com (CRM -0.16%) was initiated with a ‘Buy’ at Sterne Agee with a price target of $70.
Apple (AAPL +0.73%) was downgraded to ‘Hold’ from ‘Buy’ at Deutsche Bank.
Gabelli reported a 5.03% stake in Peregrine (PSMI +0.41%) .
Earnings and Economic Numbers from seekingalpha.com…
Today’s economic calendar:
8:30 Non-farm payrolls
8:30 International Trade
9:45 PMI Services Index
10:00 ISM Non-Manufacturing Index
11:00 Global Composite PMI
11:00 Global Services PMI
Notable earnings before today’s open: none
Notable earnings after today’s close: none
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers