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Job Growth Is Not Likely To Drive Up The Markets

Job Growth Is Not Likely To Drive Up The Markets

The Labor Department recently released February's jobs report. Jobs added to the economy drastically exceed estimates, while wage growth continued to lag. Despite the discouraging wage figures, every news outlet from The New York Times to The Wall Street Journal has been talking about the increasing market optimism, positive outlook, and economic comeback. And, just about every news outlet still expects interest rates to rise some time this year. Nevertheless, investors should not take the recent jobs report as good news for the stock market. The fact of the matter is that data since 1993 shows that job growth has virtually no correlation with the stock market. Why Investors Believe Increasing Employment Leads to a Better Stock Market The economy is supposed to drive the market. As economic indicators like GDP, output, employment levels all increase so should the stock market. In the case of employment levels, as more people… Read More …

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