Comments on the July Employment report from Nick Kalivas, Vice President of Financial Research with MF Global Research:

Stocks poke below the 200 day moving average. This is sparking technical selling. The first hold did not seem to work. The market is also dancing around unchanged on the year.

The labor market is unimpressive. Growth continues to be very sluggish. People are dropping out of the labor force. Some may see positives in the hours worked number, but I’m not reaching. The improvement in transport and retail is slightly positive, but the drop in finance is negative. Construction remains ill. I think the manufacturing number is overstated. It is marginally helpful to Treasuries and bearish to equities.  Should weigh on the dollar.

Construction fell 11,000. Residential was off 10,000 and has deteriorated in recent months – from March/April.

Manufacturing rose 36,000 helped by motor vehicles which rose 21,000 – GM?? Thinking this will unwind in August and be a drag. Outsided gain.

Retail rose 7,000

Transport rose 12,000

Financial fell 17,000 and has been down sharply the past three months

Eduction/health rose 30,000

Leisure rose 6,000

Government fell 202,000

Household survey shows unemployment down 24,000, employment off 159,000. The labor force continues to decline tumbling 181,000. The participation rate is at 64.6% and was 65.4% a year ago.

Average weekly hours rose 0.1 to 34.2.

Payrolls fell 131,000 and private payrolls rose 71,000.

Expectations were -65,000 and 90,000 respectively.

Prior private payrolls revised to 31,000 from 83,000.

The unemployment rate was unchanged at 9.5%. 9.6% expected.