October 9, 2021

Oops! NFP Data Gets Worse With Missing Away From Target!

 The futures market traded at support levels after the jobs report released looked disappointing in September.

The Dow Jones futures contract is up just 13 points. The S&P 500 futures are up 0.2%. Nasdaq 100 futures are up 0.58%. The 10 -year Treasury yield was strong at 1.57%.

The US dollar index, which measures the greenback against major currencies, traded down 0.20% at 94.043 after NFP data was released.

The employment report released just now presented a mixed reaction among investors. The economy was only able to add 194,000 in September which is a figure far below the estimates of experts who are targeting 500,000 jobs to be added. This figure carries an indication that the NFP reading recorded a huge loss two months in a row after August only recorded an additional 235,000 jobs, well below the 720,000 target.

The labor market looks gloomier and puts pressure on the Fed as the Fed prepares to tap.

The Department of Labor on the other hand reported on Thursday that unemployment claims for the previous week totaled 326,000. That is lower than the target of 345,000 experts. Meanwhile, claims continued to decline by 97,000 to 2.71 million. This reading is seen as a positive sentiment.

Finally, uncertainty over debt limits has become a barrier for markets with other risks including high inflation and rate hikes.

In general, a labor market showing improved performance and strong economic growth could prompt the Fed to loosen monetary policy.