12/8/2006 Morning Market Comment

Non farm payrolls came in a tad above expectations so its back to the fun and games in the markets with the dollar a bit weaker - the Euro is up 56 ticks, and Gold is up $4 where we're long again with a tight stop. When you look deeper into what are lagging data to begin with , it's hard to understand why the mainstream media says the report "eases concern about the economy" especially when much of the gain was built by services and retail hiring. Jobs in construction, factories, goods producing contracted; so the debate over the economy is far from over and gives the dollar bulls nothing to work with. But spin is spin and the spin today is the employment data is positive enough to abate rate cut hopes on the stock market side and stock futures are a touch lower. Crude oil also back above $63 putting a damper on things for the Wall Street bulls. The Wall Street crowd may also be getting defensive ahead of next week's Fed meeting - not that the Fed will touch rates next week, but whether the Fed decides to change its risks of inflation stance or digs in deeper.