Wall Street Laid Low by Jobs Data

"There's no disagreement that the economy is in dire straits and we need to create jobs," said President-elect Obama, as he introduced his intelligence appointments on Friday.

Behind the statistics flashing on the screens are real lives, said the president elect, urging Congress to focus on readying and passing an economic stimulus plan. "What we can't do is drag this out when we just saw half a million more jobs lost."

If there's a silver lining, said RDM Financial's Sheldon, you might argue that the jobs report reflects the severe credit crises that we experienced late last year, but doesn't yet account for an of the recent improvements in the credit markets, or the large upcoming stimulus plan.

Indeed, economic data and monetary policy are becoming more peripheral as investors are already baking in the expectation for some sort of stimulus package, says Chris Johnson, CEO and chief investment strategist of Johnson Research. Rather, he says, focus has shifted to the first earnings season of the year, and we are starting to see companies like Chevron (CVX Quote), Alcoa (AA Quote) and Intel (INTC Quote) adjusting their outlooks for 2009. As those roll in, we have a good chance of retesting November lows, says Johnson.

The recession looks to be longer and more severe than originally forecast, said Boston Federal Reserve President Eric Rosengren, in an address at the Massachusetts Mortgage Bankers Association. "Still, there are indications that the second half of the year will show improvement," he said.