Markets:
- Gold falls -$38 or -1.37% at $2748.99
- Crude oil is trading up close to $2.00 after reports that Iran is preparing for a major retaliatory strike
- Bitcoin is down close to -$2000 at $70,372. The price peaked at $73600 on Tuesday just short of the all time high at $73794 area. The buyers turned to sellers today on the failure to push to new highs.
IN the US debt market, yields are higher but off highs for the day:
- US 2-year yields 4.162%, up 0.8 bps
- US 10 year yield 4.270%, +0.6 bps
- 30 year yield 4.461%, down -1.7 bps
The major stock indices fell sharply led by the Nasdaq as the market reacted to Microsoft and Meta earnings (the weren’t that bad but the market was not hearing it) and are getting scared ahead of the elections next week. The US jobs report will also be released tomorrow and has traders anxious..
- S&P 500 down -1.56%
- Nasdaq -2.46%
- Dow -0.64%
In the forex market, the USD was mixed:
- Japanese Yen: -0.93%
- Swiss Franc: -0.33%
- Australian Dollar: -0.03%
- New Zealand Dollar:+0.03%
- Canadian Dollar: +0.08%
- Euro: -0.16%
- British Pound: +0.61%
The core PCE data today came in as expected month on month but due to revision, the year on year was 0.1% higher at 2.7% That was unchanged from last month. The headline PCE data was lower than last month at 2.1% versus a revised 2.3% (was 2.2%).
Always good on inflation is the employment cost data for the third quarter which came in at 0.8% for the month and 3.9% for 12 months. That’s down from 4.3% in September 2023. Wages and salary also came in at 3.9% compared to 4.6% a year ago.
Initial jobless claims today was stronger at 216K versus 230K estimate. Continuing claims did fall as well to 1.862M versus estimates of 1.885M. The employment statistics still seem to be strong. Tomorrow the US jobs report.
Below are the expectations:
- Consensus estimate +113K
- Estimate range +0K (ABN AMRO) to +200K (DBS Bank)
- September was +254K
- Private consensus +90K versus +223K prior
- Unemployment rate consensus estimate 4.1% versus 4.1% prior
- Prior unrounded unemployment rate 4.0510%
- Prior participation rate 62.7%
- Prior underemployment U6 7.7%
- Avg hourly earnings y/y exp +4.0% versus +4.0% prior
- Avg hourly earnings m/m exp +0.3% versus +0.4% prior
- Avg weekly hours exp 34.2 versus 34.2 prior
Numbers released so far this month:
- ADP report +233K versus +159K prior — best in a year
- ISM services employment not yet released
- ISM manufacturing employment not yet released
- Challenger job cuts 55,597 versus 72,821 prior
- Philly employment -2.2 vs +10.7 prior
- Empire employment +4.7 vs +2.9 prior
- Initial jobless claims survey week 242K versus 259K prior
