Stock Market Update

The stock market is on track for a mostly lower opening as semiconductor stocks are set to face an extension of yesterday's weakness. The question now is whether the broader market will be able to outweigh weakness across chipmakers, as in yesterday's trade, or whether investors will buy into the dip. A potential ten-week win streak is at stake for the S&P 500, with the index entering today's session with a 0.1% week-to-date gain.

Nonfarm payrolls surged by 172,000, aided by a 52,000 increase in government jobs; the unemployment rate held steady at 4.3%, along with the labor force participation rate (61.8%), and average hourly earnings increased 0.3% month-over-month.

The key takeaway from the report is that it is manna for headline writers but still lacks some important sustenance to suggest it is a marker of an economy running on a full stomach. To wit: real average hourly earnings on a year-over-year basis are down 0.4%; there were job losses in the retail trade (-1,100), information (-2,000), and financial (-22,000) industries; and the percentage of unemployed workers for 27 weeks or more increased to 27.5% from 25.3%, which we will assume speaks to the difficulty of finding a new job with comparable compensation to the prior one.