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Slow Return to Trading Post-Labor Day

We're still shaking the summer sand out of our shoes, getting onto a new investment footing.

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This story originally appeared on Zacks

Tuesday, September 7, 2021



We start our Labor Day-shortened trading week rather slowly, with no major announcements nor economic reports due out before today’s opening bell. This follows last week’s jobs numbers, both in the private sector through ADP ADP and nonfarm payrolls by the U.S. government. Although employment figures have not yet reached their near-term goals, market indexes remained at or near record highs.



Because we’re still shaking the summer sand out of our shoes, getting onto a new investment footing as the year advances toward the end of calendar Q3 will be gradual. Later this week, we’ll see a new Producer Price Index (PPI) print and weekly jobless claims, but otherwise we may see trading set to auto-pilot, barring any news items that might jar current outlooks.



We’re so relaxed coming out of Labor Day weekend, we don’t even see a real timeline for tapering the Fed’s asset purchase program. Back in February 2020, ahead of the impact of the pandemic, the Fed slashed interest rates to near-zero and put in place a system of purchasing $120 billion in government-backed bonds per month. Earlier in the year, many analysts saw the tapering of this program to begin by September. Now the best guess is the Fed won’t start until December.



That said, we do have a few remaining notable companies yet to report quarterly earnings, including Lululemon Athletica LULU after the market close tomorrow and meme-stock favorite GameStop GME Thursday afternoon. Calendar Q2 earnings season has overall been a rousing success; it is this as much as any other reason we enjoy market indexes at historically high levels.



Market ahead of today’s open, however, are all down slightly. The Nasdaq, currently riding a record-high close from last Friday (though off intra-day highs), is down roughly 7 points at this hour, while the S&P 500 — which set a record closing high of its own last Thursday — is flat (-1 point). The Dow, which seeks a new closing high last achieved back in mid-August, is -16 points right now.



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