The stock market's powerful two-day rally nearly fizzled out Friday after the unemployment rate unexpectedly jumped to 9.8% from 9.6% in a broadly disappointing November jobs report. Given that the Dow rallied 356 points in two sessions partly on expectations of a blowout Friday figure, it's amazing the stocks managed to sneak out of the week with gains, says Cort Gwon, director of trading strategies and research at FBN Securities.

"The market was very resilient considering how bad the payrolls data were," Gwon says. Bulls were primed for a strong Friday report, especially in light of the robust ADP private payrolls report released earlier in the week, says Gwon. But November's numbers were a raspberry.

stock market"Economists were looking for anywhere from 100,000 to 170,000 new jobs," Gwon says. "Whisper numbers were as high as 200,000. Instead, we added just 39,000 to payrolls last month."

Yet after spending most of the session in negative territory, the blue-chip Dow Jones Industrial Average ($INDU) gained 18 to close at 11,382. The broader S&P 500 ($INX) likewise turned positive late in the day, tacking on 3 points to close 1,225. The tech-heavy Nasdaq Composite ($COMPX) closed up 12 points at 2,591.

Make no mistake: the November jobs report -- the most important event on the economic calendar -- was a failure, Gwon says. Average hourly earnings were essentially unchanged, as was the average workweek. The broader underemployment rate stayed stuck at 17% and the number of folks out of work for 27 weeks or longer increased to 6.3 million. The list goes on.

The markets' remarkably muted reaction to the jobs report may be attributable its almost cockeyed way of discerning a silver lining in such things, Gwon says. Traders take the dismal jobs data as something that bolsters the Federal Reserve's case for QE2 -- which has been very bullish for stocks and commodities. How much longer, Gwon asks, before the lousy labor market forced the Fed to start thinking about QE3?

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virtualblair

Are they missing a question mark at the end of this article title? I read the article, I thought. I didn't watch the video, though, as soon as I saw sponsor message, I hit pause as usual - it's just not that important to me me to have to be conditioned like a cow.

December 08 2010 at 9:41 AM Report abuse rate up rate down Reply
Charles

When will the American worker and consumer realize that we have brought the present jobs situation on ourselves?? We are slow to accept responsibility for or own errors. This situation of too few jobs can be primarily laid at the feet of almost every American citizen. How so, you ask?? First, we demanded higher and unsupportable wages. Next, we sought cheaper priced foreign products. We all want a bargain!! As the auto industry faced the more competitive markets and better quality products of foregn competitors, we Americans sought the cheaper and higher quality product. Then we became "more greedy" and purchased the cheaper Chinesse consumer goods. Eventually, due to competition, the big American auto manufactures sought the cheaper labor from Mexico and elsewhere. Again, all was drinen by the "American Consumer" thirst for cheaper products. "Frankly My Dear" our thirst for higher wages and benefits and opposing thirst for lower priced products has resulted in fewer American jobs, empty American factories and a debtor nation. Folks, we did it to ourselves and have no one to blame but ourselves!! These are harsh words --but true!! Tere is hope for a solution. We must tighten our belts and maximize our suport of American made products .

December 06 2010 at 6:38 AM Report abuse +2 rate up rate down Reply
1 reply to Charles's comment
bobbsafe

Very well put. All the importing with no exporting, demanding higher wages to drive labor offshore - no more manufacturing jobs here, population explosion, college grads selling derivitives and risky mortgages - what did they expect.

December 07 2010 at 1:55 PM Report abuse rate up rate down Reply
aftonmoon

Looked at gasoline and food prices lately? The outcome of the deliberate attempt by that moron Bernake to to stimulate the buying of stocks and to create a so called,mystical, wealth effect so that the rich will begin to spend again and trickle down will occur to stimulate the economy. In order to do this The Fed printed billions of dollars, dropping the interst rate that will supposedly move money out of safe investments into stocks. This, might help wealthy stock holders and Hedge Fund manipulators but for the average person it means a fifteen percent reduction in buying power as the value of the dollar declines. In China, Bernake, Geitner, Paulson, Greenspan would have been shot, in America they are permitted to continue their destrution of the economy.

December 06 2010 at 6:19 AM Report abuse +1 rate up rate down Reply
ssyankeeclipper

if the market was falling they would tell you it's based on the unemployment report..more more and more BS from the media

December 06 2010 at 5:28 AM Report abuse +2 rate up rate down Reply
jacknab97

When the stock market's making money, you can bet the ranch the poor and working class aren't. Eat the Rich.

December 06 2010 at 1:35 AM Report abuse rate up rate down Reply
pjmducks6

Overwhelming the bad jobs report was the continued euphoria over the ECB's bailout of Portugal, Spain, and Belgium (what else would you call buying their bonds at rates that no one else would buy them at?). Wall Street just loves shaking down spineless governments for more protection money. Maybe they'll go after California next and get the Feds to bail them out there also! This game is so much more fun than hyper-inflating small country's stock markets (e.g. Iceland)and paying yourself 20% of the supposed "profit", before the market has time to collapse.

December 06 2010 at 1:32 AM Report abuse rate up rate down Reply
Iselin007

Your stuck beaten on the Dems an that isn't going to help the economy

December 05 2010 at 11:53 PM Report abuse rate up rate down Reply
Iselin007

It's a 5 year stretch to 62 but this economy isn't going to last much longer before all hell breaks out

December 05 2010 at 11:52 PM Report abuse +2 rate up rate down Reply
Iselin007

Keep your statementand print it out you might run out of toilet paper an need it.

December 05 2010 at 11:48 PM Report abuse rate up rate down Reply
Iselin007

Keep your statementand print it out you might run out of toilet paper an need it.

December 05 2010 at 11:48 PM Report abuse rate up rate down Reply