The Bureau of Labor Statistics released its February jobs report this morning and the headline number of 175,000 payrolls added beat the consensus estimate of 149,000. The unemployment rate ticked up to 6.7% from January’s number of 6.6%. The labor participation rate held steady at 63%.
Jim Paulsen, Chief Investment Strategist at Wells Capital Management says the number “is only good because people were hunkered down for the worst with weather.” That begs the question, he says, ‘what could the number have been if weather hadn’t impacted the number.’
Regardless of what is or isn’t baked into today’s number, Paulsen cautions investors not to read all that much into it from a trading perspective. “I don’t think I’d trade on this,” he says. “I still think we’re going higher here in the intermediate term. I do think the S&P 500 (^GSPC) maybe gets up to around 2,000 this year, but I also think bond yields are moving higher.”
In general Paulsen says if you are still underweight stocks and overweight bonds, it’s time to start moving your money towards the opposite set-up. He predicts the 10-year yield (^TNX) could flirt with 4% by the end of the year. As for a more volatile stock market Paulsen says despite the aforementioned 2,000 mark for stocks in the medium term, he sees the market ending the year close to where it started.
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- Unemployment Issues
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