Hello All,
 
The markets ended higher ahead of the jobs report and I would have to associate it to thinner than normal conditions ahead of a 3-day weekend.  Money has been flowing out of bonds and back into stocks as investors risk appetite grows.  Analysts are expecting a loss of 100,000 jobs for August, private employment to be up 41,000, and the unemployment rate to inch up to 9.6%.  The most important of the three is the 9.6% unemployment rate, if we get anything above that regardless of payroll, the market should react negatively without a doubt.  The macro environment will continue to dominate as it's a traders market and the wild card is the timing ahead of labor day weekend, will there be enough big boys to play the number or have they headed to the Hamptons already.  With respect to foreign currencies, the Euro continued its rally modestly as the ECB heald steady and Trichet should reiterate tomorrow that the Eurozone's recovery is on track.  Europe is currently outperforming the U.S. and as job cuts continue it will dampen the demand for the dollar, heeding a modest decline.  In normal conditions this would be bullish for dollar denominated commodities, but I just don't see it happening.  Today's rally in crude was associated to the platform fire in the Gulf of Mexico and the possibility that Hurricane Earl could impact refineries up the East Coast.  All headlines aside, we have to keep in mind that demand is low and supplies are at all time highs.  All in all, I would expect lower stocks projecting 1075 on the S&P, crude projects a minimum of 73.50, and a higher Euro towards 1.30 after tomorrows reports.  We'll sit on our hands and observe ahead of a nice weekend.
 

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