There's much not to like about the September jobs report for the market, but there's a silver lining

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Maybe this payroll report is not such a catastrophe. Wage inflation is moderating and the economy is staying strong.

What a shocker in the September jobs report: 336,000 jobs created, way above 170,000 expected. And substantial upward revisions in the previous two months: August's gain is now 227,000, up 40,000 from the prior estimate, while July went to 236,000, up from 157,000. Great news for job seekers, but a jolt to the market. Here's the silver lining though: the issue everyone is most concerned about is inflation, and wage inflation is continuing to moderate. Average hourly wages were up 0.

Seems to me bond yields are rising because the economy is staying strong. That would be good news for groups like cyclical stocks. And commodities. It is curious that copper and even beaten-up gasoline and oil are higher since the jobs report at 8:30 a.m. ET. Freeport McMoran, the huge copper and gold producer, a proxy for global growth, is trading up. Oil stocks like Occidental Petroleum are up, even as Exxon is down on reports of its interest in buying Pioneer Natural Resources .

 

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