GOIH Capital Markets: Market Overview---Worst Jobs Report in 4 years

GOIH sees the market opening sharply lower on the jobs report. We see the major market indices trading lower with an increase in volatility.

A Report of the Job Market:

Fed officials said as recently as yesterday that they were not convinced the market turmoil had spread into the overall economy.
Some economists have speculated that the Fed might even cut rates before the next scheduled meeting.

The weakness in last month's nonfarm payroll growth was concentrated in the manufacturing and construction sectors.

Manufacturing jobs declined by 46,000, the biggest drop since July 2003.

Construction jobs fell by 22,000.

Jobs in the services increased 60,000, as retail jobs rose 13,000.
Government lost 28, 000 jobs in August. Economists had been expecting an increase.
The average hourly wage increased 5 cents or 0.3% in August to $17.50, in line with expectations. Hourly wages are up 3.9% in the past year.

The average workweek held steady at 33.8 hours. Total hours worked in the economy held steady. Average hours worked in manufacturing also held steady, while factory overtime fell six minutes to 4.1 hours.

GOIH Commentary:

With more people unemployed, i.e., consumers, spending will decrease easing the economy into a recession in the fourth quarter. Our market strategies will be to short consumer retailers and the financial services sector and any sector that has a positive statistical correlation to to each of these sectors.


We see weakness in the holiday shopping season in the consumer retailers. We see weakness in WMT, BBY, and other equities we will publish in a report this weekend with our forecast of our opinion of the market condition.