US Stocks Slip After Jobs Data; http://www.marketwatch.com/story/us-stocks-slip-after-jobs-data-djia-down-91-points The consulting firm Automatic Data Processing said private-sector jobs in the U.S. fell by 532,000 slots in May, less than the 550,000 decrease expected by analysts. The report comes two days ahead of an even more closely anticipated round of monthly employment data due from the Labor Department. Traders are anticipating a similar jobs loss in that report, with the unemployment rate expected to hit 9.2% for May, up from 8.9% in April, according to a Dow Jones Newswires survey. With corporate earnings season out of the way, investors have returned their attention to the economy's big picture the last few weeks. Stocks have built on their gains that began in early March during that shift of focus, though some veteran money managers believe the market may be showing some signs of strain. "The market is perhaps ahead of itself in that we're still looking at an extended period of debt reduction and slow growth throughout the U.S. economy," said Gordon B. Fowler Jr., chief investment officer at Glenmede Trust Co. in Philadelphia. "We have to factor in all that that scenario entails." Fowler said his firm has been buying during this spring's rally, though it is nearing its target level of exposure to stocks for now. In the meantime, Glenmede is also maintaining heavy exposure to bonds, which tend to do well during periods of economic distress. On Wednesday, investors are also awaiting a new reading of the Institute for Supply Management's service-sector index, due momentarily. Also of note, Bernanke is testifying before the House Budget Committee. "He is unlikely to signal a further expansion of unconventional measures at this stage, though the measures to date have clearly been beneficial," said Paul Donovan, an economist at UBS, in a note to clients. Strategists at Credit Suisse Group kept their year-end S&P 500 target at 920 but said they are no longer "overweight" on stocks, saying the recent rise in bond yields has undermined equity valuations. They added that the economic recovery is partially threatened by the rise in yields, with each 10 basis point move on the mortgage rate lopping 1% off house prices. And the strategists said they are more positive on bonds as they feel those securities are beginning to offer value. Yields on 10-year Treasury bonds slipped 2 basis points to 3.6%, but are up from just over 2% at the start of the year.
better Initial claims ------------ http://www.marketwatch.com/story/us-stock-futures-point-to-stronger-start Oil futures rose $1.63 to $67.75 a barrel as Goldman Sachs lifted its price target to $75 a barrel. ( IV note: this seems long term yearly traget ) "We seemed to have priced in a V-shaped recovery, but we're really not going to see the data for another few months," said Bill Flaig, chief investment officer for the Arrow Funds. Though he doubts the market will test lows from March, he said a pullback could be coming if robust growth doesn't materialize. After reaching new weekly record highs since January, the number of continuing claims for state unemployment benefits has finally declined, decreasing by 15,000 to 6.74 million in the week ended May 23, the Labor Department reported Thursday. First-time applications for benefits fell 4,000 to 621,000 in the week ended May 30, reaching the lowest level since early May. Economists surveyed by MarketWatch had expected an initial claims level of 625,000. Productivity rose 1.6% in the first quarter as U.S. firms slashed their workforce, outpacing the drop in output, the Labor Department reported Thursday. It had earlier estimated a 0.8% advance. Also, rate decisions came from overseas, as the Bank of England and the European Central Bank each decided to keep interest rates unchanged. The Bank of Canada also is expected to hold rates. Retailers were releasing same-store sales figures for May. Early highlights included a 7% fall for both Limited Brands /quotes/comstock/13*!ltd/quotes/nls/ltd (LTD 13.28, -0.16, -1.19%) and Costco Wholesale /quotes/comstock/15*!cost/quotes/nls/cost (COST 47.40, -1.07, -2.21%) . Also in the retail space, Wal-Mart Stores /quotes/comstock/13*!wmt/quotes/nls/wmt (WMT 50.88, +0.95, +1.90%) said it will create 22,000 U.S. jobs this year. Arrow's Flaig said the firm has been selling some of its Wal-Mart holdings as it becomes less defensive on retailers. But he's not aggressive in the retail space either. "Wal-Mart is no longer a top 20 holding, but we haven't gone so far as to be buying Saks and Tiffany," Flaig said. The dollar continued its recent strength following Asian nation announcements that they didn't see an alternative to the greenback as a reserve currency, with the dollar up 0.9% to 96.73 yen. Boeing /quotes/comstock/13*!ba/quotes/nls/ba (BA 48.99, +0.62, +1.28%) may be active after The Wall Street Journal reported that both the U.S. plane maker and Airbus are vying for a winner-take-all order for as many as 150 jets from UAL Corp.'s /quotes/comstock/15*!uaua/quotes/nls/uaua (UAUA 4.99, -0.30, -5.67%) United Airlines. Intel /quotes/comstock/15*!intc/quotes/nls/intc (INTC 15.93, -0.01, -0.06%) announced a deal to buy Wind River Systems /quotes/comstock/13*!win/quotes/nls/win (WIN 8.40, -0.18, -2.10%) for $884 million, or $11.50 a share. SAIC /quotes/comstock/13*!sai/quotes/nls/sai (SAI 18.30, +0.70, +3.98%) rose nearly 5% as the defense contractor reported a stronger-than-forecast first-quarter profit. Oil futures rose $1.63 to $67.75 a barrel as Goldman Sachs lifted its price target to $75 a barrel. U.S. stocks closed lower Wednesday as Federal Reserve Chairman Ben Bernanke warned about the budget deficit and as ADP's estimate of private-sector employment showed 532,000 jobs lost in May. The Dow Jones Industrial Average fell 85 points, the S&P 500 lost over 12 points and the Nasdaq Composite dropped 10 points
Goldman Sachs lift oil price target to $75 http://www.marketwatch.com/story/goldman-sachs-lift-oil-price-target-to-75 LONDON (MarketWatch) -- Goldman Sachs lifted its target on light sweet crude oil to $75 a barrel from $52. "The recent rally in WTI prices is likely to be but the first stage in the oil price rally that we expect will accompany a recovery in economic activity. In all, we expect the rally we have just observed to be followed by three more stages, creating a four-stage rally in oil prices in 2009 and 2010," the broker said
what a play by Goldman Sachs and other funds! First the complete lack of buying yesterday (read VSA) caused market to drop $4 from its highs. As it was dropping Goldman and other funds were buying. When Goldman completed its buying at EOD it issues a report for $85 oil! and then market jumps $4 today.... New money and small account holders wiped out! Who was the sane guy who bought tomorrow? I started buying at 6650 (as it was critical support). I was quite worried as market dropped and stopped buying at 6550. With avg around 6600 i got out today at 6750.
I agree with above Goldman and other funds play. today there are not many buyers at this high 68+ prices after yesterdays drop , so market makers easily pulled up to this 6950 level as they really do not need to sell many lots at 68 level
Goldman raises end of 2009 oil price target to $85 http://www.forbes.com/feeds/afx/2009/06/04/afx6502746.html Goldman Sachs raised its end of 2009 oil price forecast to $85 a barrel from $65 and introduced a new end of 2010 forecast of $95, the U.S. bank said in a research note. Goldman said the recent rise in U.S. crude prices was likely to be the first stage in the oil price rally that it expects will accompany a recovery in economic activity.
http://www.marketwatch.com/story/us-stock-futures-higher-ahead-of-payroll-data payroll report MAY job loss 345,000 vs. expected 500,000 LONDON (MarketWatch) -- U.S. stock futures shot higher Friday following far-lower-than-forecast monthly job losses of 345,000, reinforcing recent hopes that the economy will expand later in the year. S&P 500 futures rose 11.5 points to 952.00 and Nasdaq 100 futures rose 12 points to 1,505.00. Futures on the Dow Jones Industrial Average rose 100 points. The U.S. unemployment rate jumped to a 26-year high of 9.4% in May as 345,000 payroll jobs were lost, the Labor Department reported Friday. The decline in payrolls was the smallest since September, and much lower than the 500,000 expected by economists surveyed by MarketWatch. Payrolls in March and April were revised higher by 82,000. Details of the report were mixed. While the payroll figures from a survey of business sites was much better than expected, a separate survey of households showed unemployment increased more than expected. Unemployment rose by 787,000 in the month to 14.5 million, pushing the jobless rate from 8.9% to 9.4%, the highest since August 1983. "We are witnessing another jobless recovery," said Stephen Pope, chief global market strategist at Cantor Fitzgerald, in an email. "Of course the U.S. wants as many people working as possible, but they have to be productive, what the U.S. needs more is profit." The market responded with cheers to the data. Futures on oil briefly climbed above $70 a barrel. The dollar rallied against the Japanese yen, and the euro rose against the U.S. dollar. Government bonds sold off, and another safe haven, gold, fell about $9 an ounce. -------------- 6/4/09 summary U.S. stocks closed higher Thursday a) as the trend of surging commodities prices was renewed ( goldman oil forecast $85 ), fueling gains for companies such as Alcoa and Chevron, b) while an analyst note spurred buying in the financial sector and broader market. The Dow Jones Industrial Average gained 74.96 points, the Nasdaq Composite Index rose 24.10 points and the Standard & Poor's 500 gained 10.70 points
sharp EURUSD drop to 1.40 is causing oil drop after good payroll report high of 70 even though equity market are up with payroll reprot
70+ is the eventual outcome. Oil may drop a little because of foreign fund liquidation which play on currency arbitrage but better economic prospects will pull in new funds and we will go up.
today crude trade is more centered around EURUSD , on top of good payroll report. It seems even next week EURO needs to watched closely to see where oil is headed . Oil is headed higher side next week, but the extent of high is determined by EURO