Strong Data Lifts U.S. Stocks, Global Markets Mixed, Rates Cuts In Focus

Strong NFP Data Lifts U.S. Stocks

Some strong labor data has the U.S. market moving higher in early trading. The futures had been down but better than expected unemployment figures and solid jobs gains reversed sentiment. The Dow Jones Industrial Average, S&P 500, and NASDAQ Composite had all been down marginally but are now up about 0.20%.

The NFP data shows 136,000 new jobs were added in September, analysts had been expecting a number closer to 145,000. Within the report, unemployment fell -0.2% to a 50-year low and the labor force participation rate increased showing new workers are finding jobs faster than they are entering the market. Average hourly earnings fell by a penny which is a concern but this is offset by the 2.9% YOY gain. With more and more younger workers entering the labor force it is possible the average earnings could tick lower.

The NFP data is especially important because of the FOMC and rate-cutting outlook. The poor ISM readings from earlier this week increased the odds of future rate cuts, this new data does not support that outlook. The CME’s FedWatch Tool now shows about an 80% chance of a cut at the next meeting.

EU Markets Are Flat In Early Trading

The EU markets are flat in early trading as global growth worries, central bank outlook, and Brexit drama weigh on sentiment. In local news, UK PM Boris Johnson continues to face intense pressure at home but there appears to be a ray of light regarding his Brexit plan. European Council President Donald Tusk says he is open to Johnson’s Irish-Backstop solution but not convinced. Regardless, it is the first and only sign that Theresa May’s Brexit deal can be renegotiated.

The DAX is trailing in today’s market and hugging the flat line. The French CAC is up about 0.20% while the UK FTSE is in the lead with a gain near 0.30%. In stock news, shares of BP are up about 1.0% after it announced its CEO would be stepping down.

Asian Markets Mixed, Hong Kong Protests Escalate

Asian markets are mixed on Friday after an escalation of protests in Hong Kong. The protests have reached a level forcing HK’s leader to enforce martial law and ban face masks within the city-state. Shares of Hong Kong-listed stocks led the rout with a loss of -1.10% while most others traded closer to break even. The Korea Kospi is the only other to fall in Friday trading losing -0.55%. The ASX and Nikkei are both up about 0.35%.