Market Hinges on Jobs Report

Even though the Dow Jones Industrial Average and S&P 500 closed down yesterday, the Nasdaq, led by the technology sector, scored a new closing high. This was the first trading day this year that the Dow registered a decline. The Dow and S&P’s decline was due to selling in the telecommunications sector, which fell 2.8%, and the retail sector, which lost 1.6%. Retail stocks have fallen for several days on reports of weaker-than-expected holiday sales. Target (NYSE: TGT ) was the worst performer, off 6.8%, after reporting that December sales increased by just 1%. The Gap (NYSE: GPS ) fell 6.9%, also from weaker December sales. And Macy’s (NYSE: M ) lost 4%, while Kohl’s (NYSE: KSS ) fell 3.1%, both from missed analysts’ expectations. But with the New York Technology Show in full swing, the darlings of the day were in the technology group. NVIDIA Corp. (NASDAQ: NVDA ) popped 14% from a move that challenges Intel Corp. (NASDAQ: INTC ) and Advanced Micro Devices (NYSE: AMD ). NVDA is developing its first computer processor aimed at the mainstream computing market. Intel fell 0.8% and AMD was off 2.5% on the news. But the semiconductor group gained 1.8%. Some of the big techs were strong with Microsoft (NASDAQ: MSFT ) up 2.93%, Sandisk Corp. (NASDAQ: SNDK ) gaining 0.92%, and Broadcom Corp. (NASDAQ: BRCM ) ahead by 2%.  In economic news, the weekly jobless claims report rose just slightly above what economists had predicted, but was a big disappointment following Wednesday’s private sector jobs report showing a surge. As a result, expectations for Thursday’s report were high, and Friday’s estimate for key government non-farm payrolls was increased. All eyes will be glued to that report today, and a big miss could cause some selling. Treasurys rose on Thursday as euro zone debt problems surfaced again. The problem this time was a document released by the European Union that asks senior bond holders to share the burden of future bailouts funded with taxpayer money. The 10-year note rose 0.531% to yield 3.418%, and the 30-year bond rose to a yield of 4.534%. The euro violated its 200-day moving average briefly, falling to $1.30 before closing at $1.3015, down from $1.3155 on Wednesday. At the close, the Dow fell 26 points to 11,697, the S&P 500 fell 3 points to 1,274, and the Nasdaq rose 8 points to 11,697. The NYSE traded almost 1.1 billion shares with decliners ahead of advancers by 1.4-to-1. The Nasdaq crossed 520 million shares with decliners ahead by 1.3-to-1. Crude oil for February delivery fell $1.92 to $88.38 a barrel in reaction to a stronger dollar. The Energy Select Sector SPDR (NYSE: XLE ) fell 65 cents to $67.79. Gold (February contract) fell to $1,371.70 an ounce, down $2, and the PHLX Gold/Silver Sector Index (NASDAQ: XAU ) lost 4.85 points, closing at 210.99. The next technical support for the XAU is at 206.
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