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by Peter Switzer

Good news continues for bulls on stock markets with a less than impressive jobs report in the US not stopping major indexes finishing in positive territory. In fact, it was a solid week for optimists with Egypt’s problems not getting in the way of the Dow Jones index finishing up 2.27 per cent for the week.

The Nasdaq was up over three per cent and the S&P 500 index put on 2.71 per cent.

For me a good omen is the VIX or fear index going under 16 on Friday, which confirms that share players are not spooked at the moment. It also coincides with a big outflow of funds from bonds into shares.

US jobs report

On the important economics front, the unemployment rate fell from 9.4 per cent to nine per cent in the States but the non-farm jobs created were only 36,000. That should have spooked the stock market but the shocking weather in the US was responsible for 32,000 construction jobs and 45,000 courier jobs being frozen out over the month.

Meanwhile, manufacturing jobs surprised on the high side, which excited those who could understand the labour force data for January.

However, bears will not have missed the fact that some 145,000 jobs were expected!

For local stocks, there could be a bit of resistance today as the greenback rose in value and the oil price fell.

Still to come

Ahead this week are more earnings reports, which will take centre stage over economic data with consumer sentiment likely to be the most important release.

In Australia, it could be a big week for interest rate worriers. Today we get the latest job ads figures and retail sales for December. Wednesday brings consumer sentiment, while Thursday we will see the important unemployment numbers. It’s the tightness of the job market that worries the Reserve Bank, and the Governor, Glenn Stevens, is bound to make headlines on Friday when he gives testimony to the Parliamentary Economics Committee.

That should be interesting!

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Published on: Monday, February 07, 2011