“Jobless claims this morning came in a little higher than expected and that lends credence to the idea that the Fed’s rate hikes are beginning to cool down the labor market and slow down the economy,” said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance. “That ‘sweet spot’ is probably around 100,000 to 200,000 jobs created where the market can take some comfort that we’re on a softening trajectory, but one that’s not gaining momentum to the downside,” he noted.ĭata Thursday showed applications for US unemployment benefits signaling the labor market still remains relatively strong, even though revisions indicated some emerging signs of softening. To Yung-Yu Ma at BMO Wealth Management, there’s probably a bit of a sweet spot where the Fed sees tangible evidence that the economy is cooling - but not too much softness. ![]() It’s worth noting that Bullard also reiterated Friday that the central bank should keep raising interest rates to fight high inflation. BE expects the Fed will deliver another quarter point hike in May, then hold rates there for the rest of the year. The March payrolls print - as well as recent jobless claims and JOLTS data - will likely convince policymakers that rates are close to a sufficiently restrictive level, according to Anna Wong at Bloomberg Economics. Benchmark 10-year rates dropped for a seventh consecutive session, trading near 3.3%.Įconomists surveyed by Bloomberg forecast employers added nearly a quarter of a million jobs in March while the unemployment rate held at a historically low 3.6%. Treasury two-year yields, which are more sensitive to imminent Fed moves, topped 3.8%. rose on a Bloomberg News report that the company plans to boost output of its 737 jets in a push for more cash. The Nasdaq 100 outperformed major benchmarks, with Google’s parent Alphabet Inc. In the run-up to the jobs data, the S&P 500 halted a two-day drop. ![]() “There are two-sided risks to this jobs report for the first time in a long time, and to hold the recent rally, we will need a ‘just right’ number, otherwise we should prepare for more volatility,” Essaye noted. Still, uncertainties on whether the payrolls data will show inflation is cooling or fuel economic worries put many traders on hold.Īs investors have aggressively priced in rate cuts this year, a “too hot” payrolls number would undermine those expectations, while a “too cold” report would add to concerns about a hard landing, according to Tom Essaye, a former Merrill Lynch trader who founded The Sevens Report newsletter. ![]() Louis President James Bullard said he doesn’t think tighter credit conditions stemming from the recent banking turmoil will tip the economy into recession. Tesla New Battery Plant Cements China’s Place in Energy Storageīond Market Is Overplaying the Risk of a Deep Recessionīig tech led a rebound in equities, which also got a respite after Federal Reserve Bank of St. Taking Crimea From Putin Has Become ‘Operation Unthinkable’ Saudi Arabia’s Drive to Get Expats to Ditch Dubai Is Off to a Rocky StartĪ $1.5 Trillion Wall of Debt Is Looming for US Commercial Properties (Bloomberg) - Wall Street remained unwilling to commit to significant positioning ahead of Friday’s key jobs report, with stocks eking out gains, bonds trading mixed and the dollar barely budging.
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