Weekly Recap - Week ending 06-Nov-09The S&P 500 gained every session this week, with the bulk of the gain coming on Thursday following solid results from Cisco (CSCO) and a surge in nonfarm productivity. The much talked about stock market correction continues to fail to materialize with the S&P 500 just 2.9% from its 2009 highs and up 60% from it's march low.

All ten sectors advanced during the volatile week of trade, though cyclical stocks saw the most buying interest.  Industrials surged 6.1%, consumer discretionary advanced 4.7% and materials gained 5.0%.  Defensive areas underperformed on a relative basis, with telecom and consumer staples both gaining just 1.0%.

In economic news, third quarter nonfarm productivity surged 9.5% in its preliminary report. That is considerably better than the consensus which called for an increase of 6.5% increase. The surge marked the largest gain in productivity since 2003. It was fueled by the sharp increase in third quarter output and the considerable drop in hours worked. With job conditions still weak, unit labor costs dropped 5.2% in the third quarter. They were expected to fall 4.2%.

October nonfarm payrolls fell 190,000 in October, which was worse than the expected decline of 175,000. Meanwhile, the unemployment rate rose to 10.2% from 9.8%, which was worse than the 9.9% consensus. The rise in unemployment was not due to more workers entering the workforce -- the labor force declined by 31,000 people as 259,000 workers left the workforce over the last month. The jump in unemployment was solely due to an increase in the number of unemployed. and reflects the continued challenges in the labor market