NEW YORK (TheStreet) -- There were 74,000 jobs added to the economy in December, far below economists' expectations of 196,000. The unemployment rate fell to 6.7%, from 7% in the prior reading.
Darrell Cronk, regional chief investment officer of Wells Fargo Private Bank, told TheStreet's Joe Deaux December's nonfarm payrolls report is an "outlier" compared to other labor statistics. It's inconsistent with the ADP reports, small business data and ISM reports.
While the unemployment rate did fall 0.3% to 6.7%, Cronk noted the participation rate also dropped 0.2%. This is partly responsible for a drastically falling unemployment rate. However, the drop from 7.3% in October's report to 6.7% in December is a big move.
How will the Federal Reserve react to the report? Cronk said it will likely continue with its gradual tapering process.
This is not the report the market had planned on seeing, he added. As a result, equities will likely trade lower into the weekend before eventually moving higher after digesting the news. This report will not "derail" the rally, he said.
-- Written by Bret Kenwell in Petoskey, Mich.