US Markets Jump as Jobs Numbers Cool – Nasdaq up 1.7%
US Share markets surged yesterday after the first jobs data of the week showed a slowing of labour demand and a Consumer confidence poll further added to the story that the US economy could be slowing. The Nasdaq added a significant 1.74%, the S&P 1.45% and the Dow 0.85%. The dollar dropped against the majors with the JPY having its first daily gain against the greenback for four days and US treasury yields fell, the 2-year dropping 15 basis points to just below 4.9% and the 10-year falling under 4.13%. Gold was another notable mover in the market driving higher on the lower dollar and trading up to $1,938/oz.
FOMC to Pause in September – Probably!
Market bets on the Federal Reserve keeping rates on hold at the September meeting have now risen to 89% after last night’s data prints in the US with a near 50/50 split on a hike or further pause by November. In addition to this, the key longer-term outlook is for the Fed to start cutting rates next year in June rather than July and if we continue to see data coming in lower than expectation then those dates will move closer. However, traders are not getting too carried away with last night’s numbers, there is a raft of other data coming out this week from the US which is much more influential to Fed thinking and these events could see even bigger moves in the market.
More Data Ahead for Traders Today
It is an event-filled day ahead for traders today with high-impact potential data releases in all three trading sessions. The initial focus in the Asian session will be on Australia with the latest release of the key CPI data, with many investors looking for inflation to continue to retreat and take pressure off the RBA. There will be more inflation data once the European session begins with CPI numbers out of Germany and Spain. The US session sees more jobs numbers in the form of the non-Farms front runner the ADP employment change as well the prelim GDP data release.
