by Sam Collins | August 5, 2013 4:00 am
A weaker-than-expected July jobs report on Friday led to a lower opening, but the Dow Jones Industrial Average powered back, registering a modest gain for the day and its sixth consecutive weekly gain.
The big headline number, the unemployment rate, fell to 7.4% from 7.6%. But the labor participation rate fell to 63.4% from June’s 63.5%, which shows that a number of workers have dropped from the labor force. This capitulation has caused much of the decline in the unemployment rate. Payroll growth fell and the average workweek dropped to 34.4 hours from 34.5. Wages fell 0.3%.
At the close the DJIA was up 30 points to 15,658, the S&P 500 rose 3 to 1710, and Nasdaq gained 14 to close at 3690. The NYSE traded 681 million shares and Nasdaq crossed 361 million. Advancers edged decliners on the Big Board by 1.1-to-1, and on Nasdaq decliners were ahead by 1.1-to-1.
For the week, the DJIA rose 0.6%, the S&P 500 gained 1.1%, and Nasdaq was up 2.1%.
Our trusty long-term chart of the S&P 500 with its 17-month moving average shows no sign of weakness and is a strong confirmation that the long-term bull market is not only intact but has gained momentum. Note how the index jumped from a slight correction after topping the highs of 2000 and 2007 as buyers hopped on the profit-taking.
Click to EnlargeThe Dow Transports rallied to a new high, confirming the previous high made by the DJIA. This is further confirmation of a powerful bull market — a new Dow Theory buy signal.
Conclusion: Despite what appears to be sluggish buying, the broad market is acting well, with wide participation and a confirming new Dow buy signal. I’d like to see both volume and breadth pick up a bit, but the major indices are in uncharted territory — the only thing that appears to be holding back stocks from another jump is a steady stream of profit-taking and a reluctance by the small investor to make a big commitment in stocks. As long as the little guy is timid, the institutions will continue to walk the market higher.
The threat of a terrorist attack will probably add to small investors’ fear, causing them to remain cautious. Our strategy is to hold for more gains and buy into any weakness.
Many thanks to Serge Berger for his superb market analysis during my absence. I believe Serge is one of the best technicians in our business. Now, if someone could only help me unpack the hundreds of boxes in my garage!
To see a list of the companies reporting earnings today, click here.
For a list of this week’s economic reports due out, click here.
Source URL: https://investorplace.com/2013/08/daily-stock-market-news-the-bull-is-confirmed-this-market-looks-very-strong/
Short URL: http://invstplc.com/1nAnzuY
Copyright ©2017 InvestorPlace Media, LLC. All rights reserved. 700 Indian Springs Drive, Lancaster, PA 17601.