What to watch: Investors eye jobs report

7:53 AM, Oct 4, 2012   |    comments
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NEW YORK -- J-O-B-S! Jobs! Jobs! Jobs! It's the new chant reverberating louder and louder across job-hungry America. President Obama wants more jobs. Republican presidential candidate Mitt Romney wants more jobs. So does Federal Reserve Chairman Ben Bernanke, as do number-crunching economists. But no one wants a job more than the 12.5 million Americans who don't have one.

Investors are bracing for the latest installment of what Wall Street refers to as "Jobs Friday." Before the stock market opens for trading Friday, the government will report how many jobs were created in September and whether the 8.1% unemployment rate went up or down. Analysts are expecting job creation in the neighborhood of 125,000, and the jobless rate to tick up to 8.2%.

Jobs matter. For a lot of reasons, says Ron Florance, managing director of investment strategy at Wells Fargo Private Bank. The latest snapshot of the U.S. employment picture, he says, could affect the presidential race. A strong number will boost Obama. A big downside miss will lift Romney.

A bad number, Florance adds, could serve as a wake-up call to Congress and "spark them to action sooner rather than later" when dealing with the nation's impending fiscal crisis. As for stocks, don't expect drastic movement regardless of the actual number of jobs created, because it will fall shy of the amount needed to cut the unemployment rate. "We need 250,000 new jobs and that's not going to happen Friday," he says.

USA Today