Mike Scinto

Analysts expect Friday’s employment report to show less than 100k new jobs added in October. The consensus estimate at the moment is 85k new jobs with a slight uptick in the unemployment rate. The uptick in unemployment is no surprise, given the record low 3.5% was reached last month.Read More

At the conclusion of tomorrow’s Federal Reserve meeting, another rate cut will likely be announced. The CME’s Fedwatch Tool is showing a 97.5% chance of a rate cut occurring, a near certainty in the market’s eyes.Read More

In our last employment report preview, we discussed the drop in domestic manufacturing and the impact that would have on the markets. On Tuesday, ISM reported the manufacturing index fell to 47.8%, the lowest since 2009 when the great recession was ending.

The selloff in markets the last two days has been attributed partly to this low manufacturing number as it implies third quarter growth will also be lower. It also dispels the notion that the US was isolated from the global slowdown many other countries have been seeing.Read More

The CME FedWatch is currently indicating a 61% likelihood that the FOMC will cut the federal funds rate at the conclusion of their two-day meeting Wednesday afternoon. If implemented, the new target interest rate would be between 175-200 basis points.

Assuming the Fed does indeed lower rates, the language used in their post-meeting press conference will be the focus of the market. Read More

In advance of the upcoming jobs report, economists expect slow job market growth in August with a traditional summer lull and the ongoing trade dispute with China as key contributors. The forecast for the September 6th non-farm payroll number are currently at 160,000 new jobs, a figure both in line with expectations as well as the gradual slowdown we have recently seen.

For roughly 4 months, forecasts have fallen steadily along with overall confidence in the economy and stock market. ADP reported 195,000 new jobs during August which is above the consensus estimate. If tomorrow’s report reveals a similar value, expect markets to have a mixed initial reaction due to its pending impact on the Fed’s decision. Read More

ADP reported 156,000 new private sector jobs in July, narrowly exceeding expectations of economists polled by Econoday who gave a forecast of 155,000 for July. These figures signal slight growth for the U.S. job market but at a slower pace, similar to the economy as a whole.

Several parallels can be drawn between the actions of the Federal Reserve to the current state of affairs in the U.S. labor market. During his press conference yesterday, Fed Chair Jerome Powell was quick to mention that markets should not expect many more rate hikes. The Fed viewed yesterday’s cut as insurance against slowing growth while Powell reaffirmed that the economy is making forward progress.Read More

When the Federal Open Market Committee wraps up their meeting later today, it will very likely conclude with a 25-basis point rate cut. Although there is always the chance for a surprise, markets are pricing in a 100% chance of an interest rate cut. The only point of contention at the moment is whether the cut will be 25 or 50 basis points.

The CME FedWatch tool shows a 77% chance to a 25-basis point cut and a 23% chance to a 50-basis point rate cut. If the Fed were to again postpone a rate hike, it would likely cause a disturbance to the markets and spark a ferocious selloff. Read More

Despite Independence Day falling tomorrow, June’s employment report release is scheduled for Friday morning. After May’s disappointing results, markets will look for a rebound in June’s numbers. The forecasted number is marginally lower than in previous months coming in at 160k new jobs.Read More

With talks of a possible rate cut during tomorrow’s meeting, the Federal Open Market Committee may attempt to avert a recession in 2019. Throughout this extended bull run, the Fed has attempted to slow inflation back to natural levels of around 3%. After years of effort, the economy has begun to lag leaving the Fed in an unclear position.Read More

With regard to the US job market, to say conditions can change dramatically in one month would be an understatement. While April jobs data had little impact on the calm markets at the time, tomorrow’s report is expected to be quite the opposite.Read More