Back to top

View the PFP Archive

Plus 5 Just-Added Strong Buys
Kevin Matras   
Profit from the Pros
By Kevin Matras
Executive Vice President
Zacks Investment Research

Stocks Down On Friday, But Higher For The Week

Stocks closed lower on Friday, but up for the week, making it 2 weeks in a row for the S&P (and 4 out of the last 5 weeks), and 5 weeks in a row for the Nasdaq (5 out of 5 for them).

Friday's better than expected Employment Situation report weighed on stocks.

Instead of the 185,000 new jobs (170K in the private sector and 15K in the public), the market was expecting, we got 517,000 new jobs (443K in the private sector and 74K in the public). The unemployment rate improved as well, ticking down from 3.5% to 3.4% (lowest since 1969) vs. the consensus for 3.6%. The participation rate improved from 62.3% to 62.4%. While wages moderated with a 0.3% m/m increase vs. last month's upwardly revised pace of 0.4%, and a 4.4% y/y increase vs. last month's upwardly revised 4.9%.

While some of those 'new' jobs (35,000) were simply employees who were previously on strike returning to work, that still puts the number of jobs gained in January at more than 2.6 x that of the consensus.

Additionally, November and December's jobs numbers were upwardly revised with an extra 34,000 added to November's totals (from 256,000 to 290,000), and an extra 37,000 added to December's (from 223,000 to 260,000).

The biggest job gains came from the following industries: Leisure and Hospitality up 128K, Professional and Business Services up 82K, Government employment up 74K (which includes the 35K university workers that came off strike), Health Care up 58K, Retail Trade up 30K, Construction up 25K, Transportation and Warehousing up 23K, Social Assistance jobs up 21K, and Manufacturing up 19K.

The market supposedly dropped on the news of the stronger than expected employment report because it suggested the Fed may not be able to take their foot off the interest rate pedal sooner than expected.

Although, Friday's pullback could very well have been nothing more than profit taking after two weeks of sharp gains.

In other news, the Services Index came in at 55.2, well above last month's 49.2 and views for 50.4.

With the next Fed meeting not until March 21-22, and the employment report behind us, the focus will go back to earnings.

We'll get 760 companies set to report this week. And another 763 next week.

In the meantime, stocks have been surging higher as inflation has been easing, and the prospects of a recession may be fading.

Still too early to tell as the Fed's rate hikes do have a lagged effect. But so far, the market sees the worst as being behind it. And stocks are climbing as a result.

See you tomorrow,

Kevin Matras

Executive Vice President, Zacks Investment Research


Why Haven't You Looked at Zacks' Top Stocks?

Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year.

Today you can access their live picks without cost or obligation.

See Stocks Free »

Most Popular Articles from

Image: Bigstock

4 Biotech Stocks Set to Outpace Q4 Earnings Estimates

We have highlighted biotech companies that are expected to deliver a beat in the upcoming quarterly results. Read More »

Image: Bigstock

4 Stocks to Watch From the Prospering Electric Power Industry

These electric power utilities have well-chalked-out capital investment plans to upgrade infrastructure and add clean assets to their generation portfolio. Read More »

Image: Bigstock

Will the Surprisingly Strong Jobs Figure Alter the Fed's Approach?

If a recession is coming, the labor market certainly hasn't received the message. Read More »

Image: Bigstock

Making Sense of Apple, Amazon and Big Tech Earnings

The market's contrasting reactions to December-quarter results from the 'Big 5 Tech Players' provides us with useful clues. Read More »

Image: Bigstock

What Lies Ahead for Commodity ETFs in 2023

Can the best performing asset class of the past two years reward investors again? Read More »


Your Exclusive Access to Today's Top ETFs

Use Zacks ETF Rank to help you select the very best ETFs for your portfolio. This quantitative ratings system takes into account asset class forecasts as well as several ETF-specific factors. All to give you a comprehensive account of a fund?s potential before you invest your money.

See Today's Top-Ranked ETFs >>

Image: Bigstock

Bull of the Day: SoundHound (SOUN)

This stock soared 43% on Friday as investors embraced a bevy of AI stocks. Read More »

New Zacks Strong Buys for February 6th

Here are 5 stocks added to the Zacks Rank #1 (Strong Buy) List today. Read More »


Download our app for convenient on-the-go access to even more—daily and weekly newsletters published by Zacks experts, proprietary research and tools, and Portfolio Tracker on

Download our Zacks App for Apple iOS
Download our Zacks App for Android

Visit Success Stories to hear how Zacks research, tools and portfolios help our members outperform the market.