Weekly gains almost wiped out on Friday
For the most part every Friday report we cover seems to have the same general news. The market psychology is generally negative so that it takes very little bad news to offset bullish news. This past week was no exception. Some friendly news early in the week was offset by Friday's non-manufacturing survey, which had a bigger impact on the equity market than the July employment situation. But then again, the employment situation was generally in line with expectations - still reflecting a soggy labor market and economy. Bond investors can satisfy themselves with the likelihood that the Fed will ease again at the Aug 21 FOMC meeting. But equity investors would rather see some positive figures in corporate bottom lines. After all was said and done, the Friday close was a slight improvement from a week ago - but not by much.

Employment report disappoints bond investors - not weak enough!
Yields on Treasury securities fluctuated in a narrow range this past week but were clearly disappointed on Friday with the 42,000-payroll drop. Evidently, they were hoping for a larger drop without upward revisions to previous month's data. Perhaps after bond investors have a chance to take a closer look at the employment report next week they will realize that the figures are inherently anemic despite the upward revisions. Yields generally closed higher this Friday than a week ago. A close look reveals that Treasury yields have fluctuated in a very tight range since July 16.