(US) Market Trading Hours Summary: September jobs report.



- TradeTheNews.com (US) Market Trading Hours Summary: September jobs report leaves little wiggle room for any near-term pause by the Fed

Fri, 07 Oct 2022 10:32 AM EST


Summary

Today’s jobs data offered few, if any, signs of slack in the labor market, and the workforce growth was moderate at best. The unemployment rate unexpectedly fell to 3.5%, an optic that makes it hard for investors to get behind any narrative calling for a pause in rate hikes. Treasury yields rose across the curve and risk assets came under broad pressure, led by significant giveback in gains made in US stock markets this week. The US dollar continued to move back up and gold prices fell. Traders are likely to quickly turn their attention to next week’s Sep CPI print, but a rise in WTI crude back above $90 is likely to rekindle worries of inflation staying higher for longer. Futures markets saw the odds of a 75bps hike at the Nov meeting rise slightly to now above 80%. Semiconductors led stocks lower after AMD preannounced Q3 results, while the energy complex was the notable bright spot.


Overnight:

-Various countries seeing declines in FX reserves as interventions used to halt sell-offs (China, Japan, Indonesia, Thailand, Swiss, Czech)

-Inflationary risks remain key driver of bond yields

-Nuclear war tensions continued to boil overnight after US Pres Biden said Putin's nuclear threat is biggest risk since Cuban Missile Crisis and warned Putin is 'not joking' about Russia's nuclear threat. Continued to warn of 'Armageddon' if nuclear weapons are used. Estonia PM Kallas echoed remarks that nuclear threats should be taken seriously.

-Economic data shed light on a trend of foreign reserves dropping amid a strong US dollar.


US Session

-(MX) Mexico Sept CPI M/M: 0.6% v 0.7%e; Y/Y: 8.7% v 8.8%e (19th month above target)

-(US) SEPT CHANGE IN NONFARM PAYROLLS: +263K V +255KE

-(US) SEPT UNEMPLOYMENT RATE: 3.5% V 3.7%E (matched the lowest since Feb 2020); Labor Force Participation Rate: 62.3% v 62.4%e

-(US) SEPT AVERAGE HOURLY EARNINGS M/M: 0.3% V 0.3%E; Y/Y: 5.0% V 5.0%E

-(CA) CANADA SEPT NET CHANGE IN EMPLOYMENT: +21.1K V +20.0KE; UNEMPLOYMENT RATE: 5.2% V 5.4%E

-Sep Manheim Used Vehicle Value Index: -3.0% M/M; -0.1% Y/Y; Values saw larger-than-normal declines

-(US) Labor Sec Walsh: Wants to see labor participation rate higher; Need to continue to bring down inflationary pressures

-(US) AUG FINAL WHOLESALE INVENTORIES M/M: 1.3% V 1.3%E

-(US) Fed's Williams (FOMC voter): Inflation is very high; Fed is a long way from where it needs to be


Europe and Asia

-(TW) Taiwan Economic Affairs Min to visit US on Oct 9-16th; Will discuss supply chain issues with US - press

-(UK) BoE Dep Gov Ramsden: MPC must stay the course on monetary policy, however difficult the consequences might be for the economy

-(UK) Citi/Yougov 12-month inflation expectations: 6.2% v 6.3% prior

-(CH) SNB President Jordan: Reiterates stance that CPI above 3% is way too high; Will not tolerate high inflation

-(UK) BOE buys £786.3M in APF Gilt purchase operation (vs £154.5M prior)


Corporate Headlines

-AMD cuts prelim Q3 Rev $5.6B v $6.68Be (prior $6.5-6.9B); Macroeconomic conditions drove lower than expected PC demand, significant inventory correction across the PC supply chain

-Samsung Electronics prelim Q3 (KRW) Op 10.8T v 15.8T y/y (12.1Te), Rev 76.0T v 74.0T y/y (78.5Te)

-LEVI rev miss estimates; cuts outlook

-PRTC confirms that it has exchanged indicative, non-binding proposals with Nektar Therapeutics, Inc

-AMBC enters into an agreement to settle all RMBS claims against Bank of America and related entities for $1.84B

-DXCM CMS proposal looks better than expected at first glance

-CANO CVS reportedly in exclusive talks to acquire Cano - press


-Dow Jones -1.5%

- S&P 500 -1.9%

- Nasdaq -2.6%

- Russell 2000 -1.8%


Treasuries:

- US 2-yr: +6bps at 4.312%

- 10-yr: +7bps at 3.902%

- 30-yr: +8bps at 3.871%

- 2-10 spread: +1bps at -42bps


Commodities:

- Crude oil $90.72, +2.6%

- Gold $1,707/oz, -0.8%

- Silver $20.30/oz, -1.7%

- Copper $3.399/oz, -1.4%

 

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