Earnings And Jobs Remain This Week's Focus  Image: Bigstock Stocks closed mostly lower yesterday, but the Nasdaq did eke out a small gain. Earnings season continues to impress. That includes both earnings and sales. And guidance as well. We've still got another 918 companies on deck to report between today and tomorrow. And then another 1,372 next week. In other news, MBA Mortgage Applications ticked lower by -1.7% (-2.0% for purchases and -2.0% for refi's). The PMI Composite report showed the Composite Index coming in at 59.9, just above expectations for 59.7, while the Services Index came in at 59.9 as well, a tad above its expectations for 59.8. The ISM Services Index rose to 64.1 vs. last month's 60.1 and views for 60.4. And finally, the ADP Employment Report missed expectations with a 330,000 private sector payrolls increase vs. the consensus for 700,000. While that was a 'surprise', it really shouldn't be. Just last week, Q2 GDP missed its views with a 6.5% reading vs. an expected 8.0%. But many have attributed that to temporary supply chain disruptions and worker shortages – the same ones cited for the temporarily higher inflation levels.
But again, these issues are transitory. With extended unemployment benefits scheduled to end in September, and many of those who were incentivized to stay home now being 'forced' to return to work, that will begin to bring relief to both supply shortages and worker shortages while simultaneously easing inflation concerns as well. That suggests big GDP growth in Q4 and big job growth as well. But it's possible we could see a lighter than expected read on jobs in the meantime, just like we did with Q2 GDP, for the same reasons.
Either way, traders will be closely watching Friday's Employment Situation report to see what the numbers look like. Stocks continue to trade near their all-time highs. And with full-year GDP still expected to come in at the highest level in 37 years, it looks like the economy and stocks both have a lot more upside to go. So make sure you're taking full advantage of it. That means getting into the right stocks and staying out of the wrong ones. Making money in the market is easier than you think. You don't have to reinvent the wheel. But there are a few tips you can use immediately on your very next trade. And there's one in particular that can transform your portfolio. You can read all about it in my latest commentary... One Little Secret for Big Results for the Rest of 2021 Best,  Kevin Matras
Executive Vice President, Zacks Investment Research | 
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