Brian.oco 0 Posting Whiz

Both the Dow and the Nasdaq are flirting with positive territory today, thanks in part to one biotechnology stalwart, Amgen, which is up three points in trading.

Why? Well, the Street is getting excited about life sciences stocks again, as several research reports hit the street suggesting that the biopharm sector was undervalued, fueling a run-up in the sector today.

Overall, the market seems to be digesting the lousy jobs number issued this morning, with the private sector lopping off 250,000 more jobs in November. Brightening things up a bit is news from the Labor Department that productivity, the key ingredient for rising living standards, rose at an annual rate of 1.3 percent in the July-September quarter. That's down from the 3.6 percent growth rate in the second quarter, but slightly higher than the 1.1 percent increase initially reported a month ago and better than the 0.9 percent rise economists expected.

If there is any good news for the technology sector, it’s that the Labor Department seems to think future layoffs won’t come as much from key sectors like technology and manufacturing, but from service sectors like restaurants, hotels, and financial services. That should help some tech workers sleep a bit better at night – the Labor Dept. projection could mean that technology, along with health care and energy companies may have found a bottom, layoff-wise. Wish I could say the same about the auto industry and banking and financial sectors, but with 400,000-to-500,000 more layoffs in the pipeline, according to the Labor Department, some employees will continue to hit the unemployment line.

Nariman Behravesh, chief economist at IHS Global Insight, told the Associated Press this morning that unemployment rate likely rose to 6.8 percent last month from 6.5 percent in October and will probably keep rising to 8.7 percent by the end of next year. "Productivity growth and the overall employment picture are on track to get much worse before they get better," he said, adding that productivity growth will probably turn negative in the current quarter and the first three months of 2009 before beginning to rebound."

For a lighter look at the financial news, TechCheck’s Jim Goldman has some predictions for the tech economy in 2009 – find them at http://www.cnbc.com/id/27894341. I thought number five was interesting: Goldman expects big tech stocks to rebound nicely in ’09, as companies like Cisco, Intel, HP, Microsoft, Oracle and IBM pick up steam. Goldman says that “many others will start the long road back to recovery on the back of Barack Obama's economic stimulus programs. Tech was unfairly sold off ahead of, and during, this latest economic meltdown. It'll be the first to recover, and likely "over" recover when things start turning around. Another big opportunity for the smart investors willing to crawl out from their shells and shoulder a little risk.”

I suggested pretty much the same thing earlier this week. Historically, technology does lead the markets back into bull territory after a recession. 2009 should be no different.