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“Not only our future economic soundness but the very soundness of our democratic institutions depends on the determination of our government to give employment to idle men.” – Franklin D Roosevelt
Economists are expecting to see this morning that the US economy put nearly 900K formerly idle men and women back into the workforce, but after Wednesday’s disappointing ADP report, that’s not such a sure thing anymore. Heading into the report, futures are eerily quiet as the S&P 500, Nasdaq, Dow, and Russell 2000 are all very close to the unchanged level. What makes the quiet even more notable is that yesterday was one of the busiest reporting days of the earnings season. Even bitcoin is down less than 1%. Oh well, it is a Friday in August. Aren’t markets supposed to be quiet? Once the report is released, we’d expect to see some increased movement in futures as a strong report will likely make the case for an earlier taper from the FOMC, while an ADP-like miss would push that timeline out further.
Read today’s Morning Lineup for a recap of all the major market news and events from around the world, including some trends related to employment heading into today’s Non-Farm Payrolls report, the latest US and international COVID trends including our vaccination trackers, and much more.
Not only has it been a quiet morning in the market, but the last week hasn’t exactly been a thriller. As shown in the snapshot below of major US index ETFs, not a single one has moved up or down 1% in the last week, and outside of the Nasdaq 100 (QQQ), none have actually even moved more than 0.50%. You can all see this in the trading range chart to the right where the only ETF where a ‘tail’ is even visible is in the Dow Jones (DIA). One other thing worth mentioning is that for all the talk about divergences between YTD performance, most index ETFs are up between 15% and 20% YTD. The only real outlier is the Russell 2000 (IWM) which is up a mere 13.6% YTD. We think this illustrates what have been smooth rotations within the market as leadership shifts.