Nonfarm payroll jobs rose by 517,000 that is much higher than expected, DXY is up with over 1% also VIX and SP500 are lower with 1%. Previous month was revised higher with 72000 new jobs and that was an important factor for this evolution. The 600,000 job gains is remarkable especially given all the job cut announcements from the IT sector. That’s the biggest one-month job gain since February 2022. The gains were led in leisure and hospitality with 128,000 new jobs in the current month. Unemployment is just below pre-Covid19 levels. The work week jumped to 34.7 from 34.4, matching the highest since December 2021.
That said we will have a stronger dollar in this quarter, instead of one more hike from FED, higher for longer for FED is in itself a continued form of QT (monetary tightening). I’m impressed how stock markets ignore this signal, Also productivity literally plunged in January because many parts of the economy are contracting (housing & manufacturing). Future Q1 GDP will most likely be negative and profit margins will continue to contract. AMZN APPLE & MSFT have one of the worst earning results; this trend will continue with other stocks.
We think these prices are good to close some winning positions