Market Recon Thursday

Good Morning,

                     Jobs Day !!  Oh, yeah, get some.  Does it matter?  Now?  Even with nations, states, commonwealths, and the guy across your street drowning in debt?  Yes, Virginia…it does.  Jobs, and the quality of demand for labor are still the most important things relevant to our economy, our lives, and the velocity of money.  There may be developments out of Greece today, but all indications are that we will not have significant breaking news on that front until after the referendum on Sunday.  Puerto Rico seems to be, for now at least, meeting obligations on a day by day basis, and Chicago is….well….Chicago.
                     About those jobs..  At 08:30 ET, we’ll get our weekly Initial Jobless Claims print that we always get on a Thursday, as well as the “once a month” Employment Situation release from the BLS that usually comes on a Friday.  The Jobless Claims number came in at 271K last week, and economists generally expect this week’s print to be in line with  that one.  There is virtually no range for this print, meaning that we are either reasonably sure of the number, or everybody is copying each other’s work.  Now, for some meat and potatoes.  June Non-Farm Payrolls are expected to tail off from May’s 280K to something near 230K.  There is almost no skew that I see, but if there is one, I think it may be to the low side.  The Unemployment Rate is not a serious number.  We all know that.  Traders don’t respect it.  Sentient beings who read newspapers,and try to understand the news don’t respect it.  The guy down your block, who used to make 85K, and now works for $9 bucks an hour doesn’t respect it.  Nonetheless the charade must go on, and the expectation is for a drop to 5.4%.  Average Hourly Earnings are projected to have increased by 0.2% m/m, off of the 0.3% pace seen in May.
                     Two important items that are part of the Employment Situation release that most economists do not generally make a prediction for, are the Participation Rate, which currently stands at 62.9%, and the U-6 Unemployment Rate.  The U-6, while not a true Unemployment Rate is the closest thing to an honest measure of the Labor Situation that we have in this country.  That number has been improving throughout the recovery, and stands at a seasonally adjusted 10.8% coming into this morning’s print.  Funny, how they try to bury this rate, being it’s twice as high as the one that they’re trying to sell you.  Factory Orders are due at 10am ET, and the Natural Gas number is due at 10:30 ET.
                      I do not see any Fed speakers out there today, and “earnings season” won’t start til next week, so enjoy your families this weekend, and most of all…..be safe. Have a very happy 4th of July !!
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Note to Readers:  This will be the last Market Recon note for a while.  As most of you know, every once in a while I have to disappear for a little bit, and that time is upon me again.  I will be at my spot on the NYSE trading floor on Monday, and Tuesday, and then I likely won’t see you for most of  the rest of the month.  May you have a wonderful July, and may God bless you.
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Sarge’s TRADING LEVELS
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SPX: 2099, 2090, 2081, 2075, 2068, 2057
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RUT: 1272, 1264, 1258, 1252, 1248, 1243