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The Economy

October 7, 2014 | Weekly Commentary

Good news was once again good news for market participants on Friday as the S&P 500 rose 1.12% following the United States Non-Farm Payrolls report in which jobs increased by 248 thousand is September.  The strong jobs numbers reduced the unemployment rate to 5.9 percent.  This is the first time since 2008 that the unemployment rate dipped below 6 percent.  These numbers came a day after Thursday’s Initial Jobless Claims release of 287 thousand, a decrease of 8,000 from the prior week’s level.  The strong jobs reports throughout 2014 seem to be creating confidence and supports continued economic growth.

Average weekly working hours in the US increased to 34.60 hour in September from 34.50 in August.  Average hourly earnings were flat in September from the prior month as employers continue to have bargaining power.  If weekly hours continue to increase, businesses will be forced to hire which over time would change the dynamic in hourly earnings growth for American workers.

In other economic news, US Non-Manufacturing Purchasing Managers Index decreased to 58.60 percent in September from 59.60 percent.  The Manufacturing Purchasing Managers index decreased to 56.60 percent from 59 in August.  Although these were reductions from prior readings, these are still strong numbers and signal economic expansion.

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