Stocks End Lower On Friday And The Week, Another Big Batch Of Earnings On Tap For This Week  Image: Shutterstock Stocks closed lower on Friday and for the week. Friday's weaker than expected Employment Situation report was cheered by the market for most of the day. But in the last hour of trading, the indexes gave up their gains and turned lower. Friday's Employment report showed 187,000 new jobs were created in July (172K in the private sector and 15K in the public), vs. the consensus for 200,000 (175K private and 25K public). The unemployment rate however ticked down to 3.5% vs. June's 3.6% and views for the same. Average hourly earnings came in at 4.4% y/y, the same as in June, but above the consensus for 4.2%. Stocks jumped on the news. Although, they couldn't hold onto those gains by day's end. Nonetheless, the optimism for most of the day stemmed from the idea that an overly hot jobs market would only provide more reason for the Fed to raise rates again come September. But a weaker (albeit still growing) jobs market would show their rate hikes are having an impact, and maybe the Fed can hit pause again in September, or call it quits altogether. Of course, one report isn't going to seal the deal one way or the other for the Fed. Especially since we'll get 2 more CPI inflation reports, 2 more PPI inflation reports, 1 more PCE inflation report, and 1 more employment report before the next FOMC meeting. But every little bit helps. Chalk Friday's report up as dovish in regards to possible Fed action. But lots more data to sift thru until then. The biggest job gainers in July came from the following industries: Health Care added 63,000 new jobs; Social Assistance Services added 24,000; employment in Financial Activities were up 19,000; Wholesale Trade increased by 18,000; Construction jobs were up by 19,000; and Leisure and Hospitality rose by 17,000 jobs. We also saw revisions to May and June's numbers. May was revised down by -25,000 to 281,000 (originally 306K), and June was revised down by -24,000 to 185,000 (originally 209K). In other news, earnings season continues on. By and large, stocks have come in better than expected. But there have been some high profile misses. Nonetheless, this earnings season, so far, paints a picture of stability and some surprising strength. This week we'll hear from another 1,818 companies, with 172 on deck for today, including Palantir, Tyson Foods and Skyworks Solutions to name a few. We'll also get plenty of economic reports to digest as well. In the meantime, stocks still look excellent. We saw some profit taking last week. But ultimately that's a good thing as it can create a new stronger base for the next leg up. We may even see a little more profit taking. (I mean, the market has been on a tear this entire year.) But I would be looking to buy the dip. With a resilient economy, falling inflation, the Fed nearing the end of their rate hike cycle, and another better than expected earnings season, it looks like there's a lot more upside to go. Add in the favorable statistical trends, and the odds get even better. So make sure you're taking full advantage of it. See you tomorrow,  Kevin Matras
Executive Vice President, Zacks Investment Research | 
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