Written Commentary
STOCK INDEX FUTURES
Nonfarm payrolls increased 528,000 when a gain of 250,000 was expected.
Private payrolls were up 471,000 when an increase of 220,000 was anticipated.
The unemployment rate was 3.5% when 3.6% was estimated. The labor participation rate was 62.1%, which compares to 62.2% in June.
The 2:00 central time June consumer credit report is predicted to show a $24.5 billion increase.
Despite an ongoing hawkish tone to Federal Reserve officials’ comments, stock index futures have trended higher since the middle of June.
Futures are likely to recover this afternoon.
CURRENCY FUTURES
The U.S. dollar advanced when the U.S. employment report was released.
Industrial production in Germany unexpectedly increased by 0.4% on a monthly basis in June of 2022, beating market forecasts of a 0.3% decline and following a revised 0.1% drop a month earlier.
All household spending in Japan on the year increased 3.5% when up 1.5% was expected.
INTEREST RATE MARKET FUTURES
Futures are lower in response to the release of the U.S. employment situation.
Despite the employment numbers today parts of the Treasury yield curve remain inverted.
According to financial futures markets, there is a 38.5% probability that the Federal Open Market Committee will hike its fed funds rate by 50 basis points and a 61.5% probability that the rate will increase by 75 basis points at the September 21 policy meeting.
Futures are likely to recover this afternoon.
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