Tuesday’s Mid-Day Movers: 3 Stories Driving Markets

The major markets were falling Tuesday as investors kept their eyes on global monetary policy moves. As of 12 p.m.:

DIJA: -0.08% to 15226.48 S&P 500: -0.31% to 1637.68 NASDAQ: -0.31% to 3463.14
Gold: -1.08% to 76.74 Oil: -0.99% to 22.04 U.S. 10-Year: -0.32% to 22.08
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Here are three stories helping drive the market Tuesday afternoon:

1. Small Firms Struggle With Meager Growth and Big Government: Small business owners felt slightly more optimistic last month, but the outlook for growth and job creation remains weak. Small firms across the nation cite taxes and government policies as their top problems.

The National Federation of Independent Business, the leading nonprofit small business association representing small and independent businesses, reported that its Small Business Optimism Index increased 2.3 points in May to reach 94.4, compared to 92.1 in the previous month. May’s reading is the second highest since the recession started in December 2007… (Read more.)

2. Retail Sales Are Struggling and Labor Market Is No Help: Economists, especially within the Federal Reserve, debate how many jobs are need to substantially bring down unemployment and thereby jumpstart consumer spending and the economy. Last week, the Department of Labor reported that the employers added a better-than-expected 175,000 jobs in May, but the results were viewed somewhat ambivalently by pessimistic and optimistic analysts alike. Even though some say job gains need only reach 175,000 per month, a large majority have argued that because U.S. job creation remained below the 200,000 level, unemployment will remain stubbornly high and that strain could emerge in weekly retail sales reports.

As warned, both the International Council of Shopping Centers and Goldman Sachs Retail Chain Store Sales Index and Johnson Redbook’s weekly reading showed weakness in the retail segment. Judging from this week’s data, it appears that the increase in jobs last month was not enough to cause a sizeable jump in income levels… (Read more.)

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3. Did Stocks Buy a Conflicted Jobs Report? Last Friday, we got the latest phony jobs report from the Bureau of Labor Statistics of the U.S. Department of Labor. The BLS reported without blushing that the U.S. economy created 175,000 new jobs in May. This occurred while the unemployment rate did not change, remaining at 7.6 percent, and the number of unemployed did not change.

How is this possible? This BLS report comes on the heels of the April report, where the BLS reported that the U.S. economy created 149,000 jobs. The truth? According to the BLS’s own CESBD report, where they guess how many new jobs were created by new businesses they think may have started that month, and then they add this estimated make believe figure to the count that gets reported to us as the new jobs number, huge fudge numbers were added to their count…(Read more.)

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