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"One must try, everyday, to expand one's limits." ~ Mas Oyama

Good evening,

Stocks just notched the fifth-worst start to September since 1928, and the worst week in a year and a half. This included a sharp drop for the S&P 500 on Friday despite the August jobs report showing a labor market that is "an ideal, middle-of-the-road" range, as Fundstrat Head of Research Tom Lee put it. 

The report showed 142,000 jobs created in August – lower than the 165,000 expected by consensus, but still an improvement on July’s numbers. Unemployment fell to 4.2% from 4.3% the month prior, in line with expectations. The number of industries adding jobs in August rose to 53% – the highest level since May. 

To Lee, those numbers were not so hot as to cause the Federal Reserve to further delay rate cuts, yet not so low as to suggest an imminent recession or hard landing. "We expected stocks to rebound on today’s report," he admitted, "and while we are disappointed this did not happen, this does not preclude a rebound next week. There is arguably a paucity of fundamental reasons for this week's disappointing market movements." In Lee’s opinion, "investors have gotten overly gloomy."