Yesterday’s stock market plunge of 998 points was the biggest intraday loss in the history of the United States stock market. The rumors are flying around about what caused this, but it appears it was some sort of trader error. Many are calling it a fat finger error that crushed the stock market. It seems someone input b for billion instead of m for million when selling a basket of stocks. The end result was relentless selling from computer trading that knocked the market way back on its heels. Between 2:45 and 2:55 eastern time on May 6, 2010, just about no one had any idea what was going on in the stock market.

The unthinkable happenings of that 998 point plunge rattled the markets and shook investors confidence in a big way. There are definitely going to be more questions in the weeks and months ahead about the safety of almost solely computer trading on the stock exchanges. What happened in this plunge was certainly abnormal, and the sooner investors know what happened and if it can be avoided again, the better things will go in the near future. The VIX has shot higher to almost 40, after sitting at about 16 in the last few weeks.

For now, the stock market is going to be extremely volatile. The confidence of the retail investor had to be hurt by yesterday’s ridiculously fast drop in stocks. Think about all the questions surrounding the market right now and you’ll realize why volatility is the name of the game. The European credit crisis, the oil spill in the Gulf, attacks thwarted in New York City, and the list goes on and on. Even as solid non farm payrolls came out today, the market is still shocked from yesterday. The lesson here is this, the stock market will have to work out the current issues and in the interim stocks will be extremely volatile. I think investors would be wise to make out a list of names they think might be good buys and get ready to get into the market if the panic gets overdone.

The stock market is rising nicely today after the February non farm payrolls report showed that the economy lost just 36,000 jobs in February, much less than the 70,000 or so analysts had expected to be lost. Severe weather throughout February gave the month a very bad backdrop, especially for groups such as retailers and those most exposed to the consumer. The weather would also hurt construction hiring since many jobs were not able to be completed due to the inclement weather during the month. December’s number was revised to just 109,000 jobs lost, from an initial estimate of 150,000. In January there were 26,000 jobs lost. The unemployment rate held steady at 9.7%.

The breakdown of jobs gained or lost does indeed show the hardest hit area was construction, which shed 62,000 in the month of February. Unemployment in the construction is estimated at a stunning 27.1%. Retail employment held steady after gaining 40,000 jobs in January. On the encouraging side of things, 47,500 temporary workers were added in the month. Private business services, often seen as a barometer for the jobs market overall, added 51,000 jobs in the month of February.

Clearly the jobs market is on the mend from where it was several months ago. Right now we are talking about nearly break-even jobs gained and lost, which is a big improvement over 600,000 jobs being lost per month. There definitely needs to be more improvement and it will be interesting to see what the spring brings for the job market in the United States. Temporary workers being picked up tells me that employers are starting to edge back onto the side of hiring, but they are doing so cautiously. March’s employment report has a chance to be our first month of gains in quite some time, so stay tuned and see if the economy can get back on the path of creating jobs!