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Technology Stocks : Semi Equipment Analysis

SOXX 301.15

-1.2%

Dec 31 4:00 PM EST

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To: willcousa who wrote (14304)	4/2/2004 11:37:21 AM
From: Donald Wennerstrom	Read Replies (1) of 95657

The source for the unemployment numbers come from a different source than the payroll numbers - this leads to much confusion. From Briefing.com Highlights * March Payrolls 308K, 5.7% unemployment rate, 0.1% earnings, 33.7 hour workweek. * Key Factors * Nonfarm Payrolls: Largest gain since April 2000 and 2.5 times larger than the market estimate. * Revisions lifted the Jan and Feb payrolls by a combined 87K. A very new picture of a far healthier labor market. * Return of California grocery store strikers wasn't even noted given the huge headline figure. * Manufacturing was flat for the first non-negative growth in 44 consecutive months. Progress. * Construction payrolls jumped 71K. * Private service providing payrolls surged 199K -- broad-based in retail, education, health and business services. * Government payrolls rose 31K to leave a 230K surge in total service jobs. * Unemployment Rate: Edged higher to 5.7% -- first rise since September. * Down 0.7% from the 6.4% June peak as self-employed and small company hiring provides the direction. * Source is the volatile household survey which can add more confusion than clarity. Far different read than payrolls. * Hourly Earnings: Small 0.1% rise lifts the annual rate to 1.8% from Feb's 1.6% low. * February's 1.6% annual rate matched the 40 year low of Dec 1986 -- half of July's 3.1%. * Earnings growth (wage costs) shouldn't be an overriding employment concern given the strong trend of productivity growth. * Average Workweek: Small decline to 33.7 hour workweek after two months at 33.8. Added workers reduced the need. * Still suggestive of relatively weak labor demand. Hasn't yet broken above the year and a half range. * Manufacturing workweek also edged lower to 40.9 hours as overtime held at a long 4.6 hours. Big Picture * The surge in March payrolls removes much concern over the tight labor market as stronger underlying economic demand is now more pronounced than the offsetting strength of labor productivity. Employment trends lag the overall economy as final demand (in excess of labor productivity) feeds in to labor demand. The unemployment rate has turned sharply lower from a 6.4% June peak as the return of discouraged job hunters to the labor force hasn't yet hit the figures. Hourly earnings unexpectedly turned sharply lower as labor demand and productivity strengthened. The length of the workweek hasn't shown a sustained rise but expectations took a great leap forward in with the March strength in labor demand.

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