What Happened to Equities in the 2004 "Jobs Recovery?"

So, the market expects 200,000 jobs were created in Feb. The last Jobs recovery began in the spring of 2004.

On April 2 2004, the BLS reported 353k jobs were created in March 2004. But the SP500 had peaked on the March 5 2004 NFP report, and failed to sustain a trade above the Feb 19 2004 high. A sharp reversal ensued after the March 2004 NFP report that lasted until August 2004. The manufacturing and jobs recovery had already been priced into the SP500 by the time the job recovery news was ushered in on April 2 2004. The market was already pricing in future fed fund rate hikes.

Btw, the job recovery in 2004-2006 was very uneven, and the peak monthly job growth on an annualized basis was 178,000 and ranged between 154k to 178k in 2004-2006 ~ well below 200k a month. The slack in the labor market was the excuse Easy Al gave the public for the gradual pace of tightening monetary policy. Annualized it will be highly improbable that it averages 200k a month. An uneven job recovery is more than certain in 2011-2012 given the reality that state and local govts are forecast to cut another 800k public sector jobs. And if the GOP gets their way with spending cuts at the federal level, you can tack on several hundred more public sector jobs at the federal level will be lost

The chart frame on the right shows the SP500 peaking on the March 5 2004 jobs report. The push to the final high of March 5 2004 began from a Feb 24 2004 low. Tomorrow is the March 4 2011 jobs report. The chart frame on the left shows the SP500 has been rallying from a Feb 24 2011 low. Tomorrow is also the two year anniversary to the March 6 2009 NFP low at 666. A 666 DOUBLE =1334