Analyst: Every Portfolio Needs Stocks Tied to Reopening
Stocks were once again in freefall mode in intraday trading on Friday, following Thursday's selloff.
This selloff comes after U.S. companies added to their ranks in August, pushing the unemployment rate below 10% for the first time since the coronavirus pandemic began in March, though the economy is still out about 11.4 million jobs since the pandemic was first declared.
Nonfarm payrolls rose by 1.371 million last month, down from a revised 1.763 million new positions in July but below analysts' forecasts of 1.4 million, the U.S. Bureau of Labor Statistics reported on Friday. The unemployment rate fell to 8.4% from 10.2% last month, better than analysts' forecasts of a drop to 9.2%.
And that jobs report followed stocks declining the most since early June on Thursday as tech shares--the darlings of the recent rally slumped sharply.
"The job market broadly is something like a whirlpool, where beneath the surface there are swift cross-currents including job loss. Many of the recent large company announcements regarding furloughs and job cuts have yet to hit, indicating that the economy continues to face challenges in the months to come," said Mark Hamrick, Bankrate.com's senior economic analyst. "With the national unemployment rate still elevated, and with New York and Los Angeles recently suffering through jobless rates above 16%, the urgency of passing another round of federal relief legislation hasn’t lifted in Washington. While some elected officials may be focused on the election now 60 days away, their responsibility to serve the broader part of the American people hasn’t been excused."
Jeff Marks, senior portfolio analyst with Jim Cramer's Action Alerts PLUS portfolio, weighed in on the jobs report. Watch the video above for more.
And Maven Mish Talk discusses the jobs report as well.
You can follow Katherine Ross on Twitter at @byKatherineRoss.
Latest Videos From TheStreet and Jim Cramer:
- Why Exxon's Job Cuts Are 'A Sign of the Times'
- Coronavirus Update: Vaccine News From Sanofi and Novovax
- Macy's Thanksgiving Wish: A Strong Holiday Shopping Season
- ADP Payroll Report Shows Companies in No Rush to Re-Hire
- Which Companies Could Jim Cramer See in the Dow in 100 Years?
- Why 52 Black Former Franchisees Are Suing McDonald's