Charts: The S&P 500 closed at 1025, down .45%. The index plunged at the opening bell on bad fundie news. It found support just above the 1018 breakout point. It rallied close to the August highs and found resistance at 1031. It was weak going into the close but managed to finish at the mid-point of the day’s range. Finding support at 1018 was encouraging, however the charts are pretty grim. Earnings season is just around the corner and soon charts will become less important because the market will care more about actual results.
Fundamentals: The government’s monthly jobs report came in much worse than expected. Most worrisome is the reversal in the average work week, which had been getting longer throughout the recovery. The work week shortened at a fairly harsh clip, growing evidence that the recovery is faltering due to stimulus programs ending and manufacturers slowing at the end of a restocking cycle.
Geopolitics: In Pakistan today, 1 good guy killed and two injured. 3 bad guys killed and 9 taken prisoner. In Afghanistan over the last 48 hours, 3 American soldiers killed, 1 British soldier killed. There is no NATO bad guy body count from Afghanistan but it probably was somewhere between 3 and 15. The CIA says that it killed Tahir Yuldashev in an Aug. 27 drone strike. Tahir was Al-Qaeda’s top Uzbek leader. Uzbekistan is an Al-Qaeda heartland and Tahir’s death is a big blow to the numerous bad guys in that region. The combo of the CIA and ISI is causing drone strikes to move up the food chain from mid-level operatives to Al-Qaeda’s top leadership.
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