In fact nkotb, here you go
http://www.djnewsplus.com/article/SB122597675121080335.html?mod=h&a=Mark+to+Market&h=Obama+Rally+Turns+Out+To+Be+Illusory Obama Rally Turns Out To Be Illusory
By JIM MURPHY
A DOW JONES NEWSWIRES COLUMN
NEW YORK -- There was, after all, no Obama Rally in the U.S. stock market.
Tuesday's 305-point gain in the Dow Jones Industrial Average was succeeded by Wednesday's 486-point plunge in the DJIA.
In fairness to President-elect Obama, the gusty gains in the three major stock averages on Tuesday and the lusty losses in the three averages on Wednesday had nothing to do with him.
It was, as was said in the 1992 presidential campaign, "the economy, stupid."
The main drag on U.S. stocks Wednesday appeared to be the approximately six-point fall in the services sector index in October, which was released at 10 a.m. EST by the Institute for Supply Management. The ISM index, at just above 50 in September, plunged from expansion territory to firmly in contraction mode in October. The services index was just, as I presciently noted on Wednesday morning, playing catch-up with ISM's manufacturing index, which we learned from the October report is wallowing in the neighborhood of 38.
In the U.S., service sector jobs account for about 80% of the economy, which is a surefire indication of how important it is when the bottom appears to be falling out of the so-called non-manufacturing sector.
The sharp contraction in the ISM services index also depressed stocks, I believe, because it strengthened the market's foreboding that the worst is yet to come. Indeed, most economists that I've heard or read believe the fourth or current calendar quarter will be the nadir of this recession. They believe the economy will stage an extremely modest recovery in the four quarters of 2009 -- a recovery so modest as to have the professionals arguing among themselves about whether it ought to be called a recovery at all.
We won't have to wait long for the next piece of really bad news. Friday morning, we'll learn that nonfarm payrolls dropped in October by at least 200,000 jobs and the unemployment rate shot up to at least 6.3% from 6.1% in September.
While we're waiting for the October jobs report, we can chew and digest another not-insignificant economic indicator, which is the report on U.S. productivity and unit labor costs in the third quarter.
The already-reported fractional contraction in 3Q gross domestic product almost guarantees that productivity for the same quarter fell sharply.
Here at Dow Jones Newswires, the median forecast of the economists we surveyed is that Q3 productivity rose by only 0.4% following a quite respectable gain of 4.3% in the second quarter.
The flip side of productivity is unit labor costs. It follows as the night the day that, if productivity moves more than nominally in either direction, unit labor costs will move in the opposite direction. That is why the Dow Jones forecast of a 0.4% rise in Q3 productivity brings with it the forecast of a 3.0% increase in unit labor costs (ULC) following a 0.5% decline in ULC for the second quarter.
The productivity report will be released at 8:30 a.m. EST.
The other 8:30 a.m. indicator is weekly jobless claims for the week ended Saturday, Nov. 1. The emphasis here will be, as it has been recently, on continuing claims, that is, a head count of the number of claimants who remain on the benefit rolls from week to week to week.
If the Dow Jones forecast for first-time jobless claims in the latest week is on target, it will only strengthen the focus on continuing claims. Our forecast is that initial claims were unchanged at 479,000 from the previous week.
