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The Daily Dow LEXINGTON, KY. (September 5): And the market plays the waiting game. Ahead of tomorrow's monthly employment report, there wasn't a lot of trading going on, but the general direction for the markets was down as nervousness paralyzes Wall Street.
Here's the scenario. If the economy continues stronger than expected (and tomorrow's employment report is supposedly one of the key measures, but aren't they all?), then the fear is that the Federal Reserve will raise interest rates at its September 24 meeting. The flip side, though, is that if the economy is stronger than everyone has thought, then it's likely also that corporate earnings will be higher than anticipated.
So in the bizarre language of Wall Street, the strong economy is both good and bad simultaneously. Now you know why we don't spend much time fretting over these reports (especially since there's a new one every few days that's supposedly "the key" number).
All that said, today was a weak day for stocks. Period.
In company news, DuPont's Conoco subsidiary and Gulf Canada Resources, Ltd. have agreed on a joint venture for multi-zone oil exploration in North Dakota. The venture includes exploration on all Gulf and Conoco lands in seven townships comprising 161,280 acres, Gulf said. Prospects in the region include the Lodgepole, Mission Canyon, Red River and Silurian Interlake geological zones. Gulf will own 60% and Conoco 40%.
And for Eastman Kodak (and other photography companies), it appears the new Advanced Photo System is a hit. In fact, the new cameras and film are selling so well, production can't keep up with demand and many of the companies are cutting advertising and marketing plans until they can meet the growing demand again.
Complicating matters, a second-generation of newer APS cameras is due in a few months. Manufacturers claim the film-and-camera innovation makes picture-taking easier and provides better print quality because of its silver-based film. The camera features no-error drop-in loading and a built-in option to select different print sizes on the same roll of film.
Be prepared, Fools. Tomorrow could be a volatile session. Regardless of what the employment numbers actually are, there will be at least two diametrically opposed interpretations of them. (Is it possible to have more than two diametrically opposed elements?) Stay Foolish!
Transmitted: 9/5/96 Today's Dow Numbers
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