Yesterday morning’s momentum continued through the day with stocks staging another nice rally and rates getting hit a little. All of that is moot as of this morning though- it’s Employment Friday!
Let’s be clear folks- anything under 200k jobs being created is not enough, however, the 175k reported was better than expected. The slight uptick in the unemployment rate (6.6 to 6.7%) is likely attributable to more people actually looking for jobs which is a good thing. How will the market interpret all this? By the looks it all being received well and stocks are looking to gain on yesterday’s rally. Rates are being pressured by this with the preopen pointing towards gains in rates. If you waited to lock it looks like the best time is past for now. If you’re still floating you may want to pull the trigger early because this can get worse before the day is out.
The employment report is the 800lbg gorilla for the day, but International Trade data also came out this morning. No surprises here as imports and exports increased almost evenly and the trade gap is pretty much unchanged.
So employment will be the talk of the day, and with this positive report you can count on the Fed to continue the taper at its current pace of $10bil/meeting. We have William Dudley- Fed Chief from NY- speaking later today but expect no surprises.
Looking ahead to next week we have a light data calendar through Wed so wherever we settle today should likely be the range we maintain for the next few days. Of course the geopolitical issues remain the wild card that can really shake things up so don’t forget Ukraine…
Have a great weekend and write plenty of deals!
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