Some Welcome Good News Turns the Market Around

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March 13, 2018 - by Louis Navellier

Last week, the S&P 500 rose 3.54%, the Dow rose 3.25%, and NASDAQ set a new all-time high. There is no doubt that buying pressure by institutional investors in fundamentally superior stocks was behind last week's strength, which bodes well for quarter-ending window dressing in the upcoming weeks.

The Friday jobs report gave the market a big boost, pushing the Dow up 440 points after the Labor Department announced that 313,000 payroll jobs were created in February, substantially above the consensus estimate of 205,000. Also bullish was that December and January's payrolls were revised up by a cumulative 54,000 jobs, so an average of 242,000 jobs have been created in each of the past three months. The labor force participation rose to 63% in February, up from 62.7% as more workers continue to enter the labor force. As a result, the unemployment rate remained at 4.1% for the fifth straight month. 

The news that North Korea would suspend nuclear testing and hold talks on denuclearization with the U.S. is also welcome news; but the hopes of a successful resolution is premature, since previous talks with North Korea have come to nothing. However, President Trump has put the U.S. in a strong negotiating position with its increasing military buildup and sanctions, so there is hope of an eventual successful resolution, even though almost all experts (including President Trump himself) are skeptical.