ELAM: Market yawns at 559K new jobs

AMC plans to sell more stock, while cautioning potential buyers that they might lose all their money.

WSJ Friday morning

AMC rose from $10 to $70 in May. Not bad for a company with no earnings. That headline is in keeping the numerous news items we have noted the last few weeks in this space. Such utterances are only seen near market tops when ordinary caution goes on holiday. Here are some other clues.

Universal Music plans a record $40B SPAC.

United Air takes out a full-page ad planning to purchase 15 supersonic passenger jets. Service would begin in 2029. Recall British Air and Air France tried the Concorde from 1976–2003. It cost about 30 times a subsonic flight trans-Atlantic. Big ideas like this (Empire State Building) surface at market tops.

Some 559,000 new jobs in the latest report drew only a modest lift in stock prices, stores still cannot find enough workers to fill jobs.

The hemline indicator suggests that higher hemlines are the result of frisky attitudes in clothing and stock purchases. Each day Yahoo.com has featured a friskier swimsuit photo. Today we have a new outlier with the Floss Bikini. The top ties wrap multiple times around the model’s body resulting in an odd tan line. And the suit is well, not what you would choose for your daughter, frisky indeed.

The reports say unemployment has fallen to 5.8%. But as noted there are more vacant jobs than idle workers; no wonder the market yawns. We noted last week that the major indexes, the S&P and the DJIA, topped May 10. We had suggested a top in June, but so far May 10 is holding.

On the qualitative front, Team Biden is having trouble passing its multi-trillion stimulus package as workers cash government checks while streaming Netflix. No wonder employers are frustrated. The filibuster rule requires 60 Senate votes for passage. Joe Manchin and Krysten Sinema are the two holdouts for keeping the rule. I would hire a food taster if I were one of them.

We suggested higher commodity prices into June. Crude is creeping up to $70 at $69.26.  Energy shares are up but looking toppy. The Goldman Commodity Fund GSG topped at $15.87 this week now trading at $15.67.

We are sticking with the idea of a significant top in most markets in this or nearby time frame. Exxon has new directors who want to literally tilt at windmills, and away from fossil fuels. That will be a difficult transition. And finally this is a seasonal lull in stock prices after tax day. Things usually pick up late August with another swoon into October. Be alert, there are plenty of supersonic ideas in the air.