Market week: S&P 500 up 3.20%, unemployment reaches 10%

November 9, 3:23 PMBaltimore Financial ExaminerTom Taylor, CPA/PFS

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Funny thing, the stock market; you would think on a day when the nation's unemployment rate crossed the 10% threshold the stock market might react negatively.  On the contrary.  Friday marked the first time since Lech Walesa won the Nobel Peace Price (1983) that the nation's unemployment rate was greater than 10% and the market was up, modestly.

That's a big number and to put the figures on it, that's 15.7 million Americans out of work or temporarily displaced.  Not good at all.  However the stock market is a forward thinking machine and the nation's unemployment statistic is a backward looking number.  The statistic says, "this is how many people were/are unemployed" and many believe the stock market is a harbinger of things to come.  Only time will tell if the stock market has it right.

The Dow was up 3.20% last week along with the S&P 500 and 3.29% for the NASDAQ.  Year to date all major market indexes are in positive territory at above 15% gains for the year, except the Dow which is up 14% for the year.  Don't be surprised if the biggest gaining sectors and stocks of the past year see some selling pressure as we head into late November and early December.  With the likelihood of capital gains tax rates increasing next year, investors will want to lock in profits and pay tax on gains at the 2009 rate versus a higher rate next year.

See all the statistics here in my market week newsletter along with last weeks headlines and an eye on the week ahead.

Market Week: November 9, 2009

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Tom Taylor, CPA is a fee-only, independent Financial Planner and Certified Public Accountant and can be contacted at Chesapeake Financial Advisors or Taylor & Company in Towson, MD.  He is a member of NAPFA and the MACPA and AICPA.