October 5, 2023

Markets:

U.S. stock futures traded lower Thursday, as investors looked ahead to key jobs data on Friday.

Weekly jobless claims numbers came roughly in-line with estimates. Initial jobless claims came in at 207,000 for the week ending Sept. 30, ticking up just 2,000 from the prior week’s numbers. Economists had forecasted 210,000, according to a Dow Jones consensus estimate.

Stocks were coming off a positive session. The S&P 500 added 0.8% on Wednesday, while the Dow rose 0.4% and snapped a three-day losing streak. The tech-heavy Nasdaq Composite was the outperformer of the three major averages, jumping 1.35%.

Stocks were aided by a retreat in Treasury yields. The rate on the 10-year Treasury note slipped from highs last seen in 2007 after payroll processing firm ADP said that private job growth totaled 89,000 for September. That number came in well below the 160,000 estimate from Dow Jones, and it seemed to assure investors that the labor market is loosening.

The 10-year yield was little changed Thursday.

Portfolio:

We enter the new trading session holding set-ups in AX, PATH, TH, and TQQQ . Now we see if this was a mechanical bounce yesterday or the start of the path higher (which we do expect to end the year). The pain trade for the overall market is higher. The amount of market top chasers and Bears is most likely at year highs right now. Does it take one more event to capture everyone to one side before the runup or do we go from here? We will clearly respect both sides of the trade but as long as the overall market technicals remain, I cannot see how one can justify being a full bear here. Let's continue to pinpoint opportunity. Reminder; do not chase the day to day moves! Let's have an outstanding session and start to plan our way to a monster close for the year!