Investors were caught off guard on Friday when the June jobs report indicated there were 222,000 jobs created in June, blowing analyst expectations for 179,000 jobs out of the water. Investors cheered the headline number, sending the SPDR S&P 500 ETF Trust SPY 0.09%up 0.6 percent. However, TD Ameritrade Chief Market Strategist JJ Kinahan said the devil is often in the details.
The largest growth came in the health care sector, which added 37,000 jobs on the month. Professional and business services also added 35,000 jobs in June and has now added 624,000 total jobs in the past 12 months.
“If you look at where some of the jobs were created that were surprising, it’s government jobs,” Kinahan told Benzinga. “I wouldn’t call those the highest-paying jobs in the world.”
Kinahan noted that the country added a surprising number of jobs in the restaurant industry as well, which are also not typically high-paying.
“Construction was a nice surprise, and those are high-paying jobs, so that was good,” Kinahan said.
There was also a distinct lack of bad news in another key industry.
“The lack of job loss in retail [was surprising], and I think that’s a positive thing for the economy overall,” Kinahan said.
He noted that the retail sector was particularly strong given recent headlines about layoffs my major employers such as Macy’s Inc M 1.26% and J C Penney Company Inc JCP 1.6%.
For investors, a big jobs beat often serves as a stock market catalyst. According to a study using Kensho, industrial stocks typically rally…
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