Tomorrow brings the monthly jobs report. The expectation is 80,000 new jobs created. If the actual number is greater or less, I have no idea how the market will react. This is an instance where good or bad news can be translated just about any possible way. Yesterday's Fed Funds benchmark rate cut as well as corresponding discount rate cut were welcomed by Wall Street. Today, the spin is different. Traders are gaming the wording in the release where the Fed statement said; "the Fed judges that, after this action, the upside risks to inflation roughly balance the downside risks to growth." The take-away is no more rate cuts. My guess is that this is the Fed acting judiciously, with their moral suasion sword cutting a wide path today, talking the market down, attempting to put fear and concern into any speculative investment schemes. However, the bond market is rallying, and the futures market now places a 74% chance for a rate cut at the December meeting. So, I think the analysis here is: It's not what the fed says, it's what they do!
So, we'll see what tomorrow has to offer for the stock market. We have a heavy volume distribution day at hand, and bull markets can sustain periodic distribution days, but we don't want to see many distribution days racked up back to back. Good luck.
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