Jobs Reports Keeps Bulls in Charge, For Now

U.S. markets

U.S. markets showed strength for the 2nd-straight session following a jobs report that was not as weak as feared. Optimistic comments from President Trump regarding upcoming U.S.-China trade talks added to the jobs report momentum which tempered rising worries of a deeper slowing in economic growth, if not recession by 2020.

Fed speak throughout the day supported expectations for another quarter-point rate cut at the end of the month FOMC meeting and also fueled enthusiasm for stocks. Despite the solid gains on Friday, the major indexes were mixed for the week with the VIX closing below a key level of support.

The Dow rallied 1.4% after trading to a late day peak of 26,590. Near-term and lower resistance at 26,400-26,600 and the 50-day moving average was cleared and held with a close above the 26,800 level being a more bullish development.

The S&P 500 was also up 1.4% following the run to 2,953 ahead of the closing bell. Prior and lower resistance at 2,950-2,975 and the 50-day moving average was recovered with a close above the latter getting 3,000 back in play.

The Nasdaq jumped 1.4%, as well, after tapping a session high of 7,986. Prior and lower resistance at 8,000-8,050 and the 50-day moving average was challenged but held with continued closes above the 8,100 level being a more bullish signal for higher highs.

The Russell 2000 rose 1% after closing at 1,500 and session peak. Prior and lower resistance at 1,500-1,520 was cleared and held by a quarter-point with more important hurdles at 1,525 and the 50/200-day moving averages as they formed a death cross on Friday.

For the week, the Dow lost 0.9% and the S&P 500 was lower by 0.3%, with both indexes down for the 3rd-straight week. The Russell 2000 sank 1.3% to extending its losing streak to 3-straight, as well, while the Nasdaq gained 0.5% to snap a 2-week losing streak.

Financials and Technology and Real Estate were sector standouts after rising 1.9% and 1.7%, respectively, while Consumer Staples and Healthcare advanced 1.6%. There were no sector laggards for the 2nd-straight session.

The worst performing sectors for the week were Energy (-4.4%), Industrials (-3.9%) and Financials (-3.6%). There was no sector strength for the overall week

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Boston Beer (SAM) upgraded to Neutral from Sell at UBS
Charter (CHTR) upgraded to Overweight from Sector Weight at KeyBanc
Snap (SNAP) upgraded to Equal Weight from Underweight at Morgan Stanley

Ambarella (AMBA) resumed with a Hold from Buy at Stifel
EchoStar (SATS) downgraded to Neutral from Buy at Citi
HP Inc. (HPQ) downgraded to Hold from Buy at Loop Capital

Before the open: None
After the close: None
Note: 3Q earnings season gets underway this week...

Monday's economic reports (EST): 
TD Ameritrade IMX - 12:30pm
Consumer Credit - 3:00pm

Gold closed at $1512.90 an ounce, down $0.90
Silver settled at $17.28 an ounce,  down $0.06
Copper finished at $2.56 a pound, up $0.01
Crude Oil was at $52.96 a barrel, up $0.66
Bitcoin Investment Trust (GBTC) ended at $9.79 up $0.04

I hope this helps you prepare for the trading day. Make it a great one!

   Todd Mitchell

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