Investors will be focusing on new data on the U.S. labor market, including job openings and the nonfarm payrolls report, as well as earnings reports from retailers and the latest inflation data.
Investors are eagerly awaiting news about the health of the US labor market, with reports on job openings, labor turnover, employment, and job cuts expected this week, as the Federal Reserve aims to cool the economy to fight inflation caused by higher labor costs.
The August 2023 Workforce Activity Report by UKG reveals that the labor market remained steady overall across most sectors, with a decrease in shift work mirroring historic seasonal trends and the market remaining strong as summer comes to an end.
The US labor market shows signs of easing as job openings decline for the third consecutive month, worker quits decrease, and layoffs increase, indicating a more balanced state, according to the Bureau of Labor Statistics.
U.S. job openings reach lowest level in nearly 2.5 years in July, signaling a slowdown in the labor market and potential impact on interest rates.
Federal Reserve Chair Jerome Powell's recent speech outlined three tests for incoming data to prevent further rate hikes, and the Job Openings and Labor Turnover survey revealed a decrease in job openings, leading to a rise in the S&P 500 and a decline in the 10-year Treasury yield.
The August jobs report is highly anticipated as investors assess the health of the labor market amidst rising interest rates and inflation, with projections indicating an increase in hiring and a steady unemployment rate, but potential disruptions from ongoing strikes and bankruptcies could affect the data. The report is closely watched by the Federal Reserve for signs of labor market softening as they grapple with inflation, and while the labor market has remained tight, there are indications of a gradual slowdown. Job openings have decreased, along with resignations, pointing to a labor market that is cooling.
Job creation in the American labor market is expected to slow down in August, with the addition of approximately 170,000 jobs, reflecting a mild cooling of employment growth and wage growth, as well as the impact of higher interest rates on hiring; the recent strikes in the film industry, although not a significant direct employer, are likely to have some impact on the jobs numbers, particularly those related to on-set production and support roles.
The US job market shows signs of slowing but remains resilient, with 187,000 jobs added in August and a rise in the unemployment rate to 3.8%, as more people actively look for work. Wage gains are easing, signaling a potential slowdown in inflation, and the Federal Reserve may decide against further interest rate hikes.
The week has been driven by macroeconomic data, but the threat of economic contraction is not currently imminent, with the US Ten-Year Note yielding around 4.11% overnight and the US Dollar Index trading around 103.5; the Bureau of Labor Statistics will release its employment-related surveys for August today, with economists expecting non-farm job creation of around 170,000 and wage growth at 4.4% year over year.
The Labor Department released its monthly data for job growth, with the U.S. economy adding 187,000 jobs in August, in line with expectations, although the unemployment rate unexpectedly increased to 3.8 percent, possibly due to more people entering the labor market.
The U.S. jobs market remains steady as two different sources, ADP and the Bureau of Labor Statistics (BLS), provide varying estimates of how many workers were hired in a given month, leading to uncertainty for Federal Reserve officials monitoring the labor market.
Job openings rose in August after three consecutive months of decline, with 9.6 million job openings recorded, indicating a tightening labor market and potential impacts on inflation and interest rates.
The number of job openings in the US unexpectedly surged in August, indicating the strength of the labor market, with 9.61 million open jobs, according to the Bureau of Labor Statistics.
Pre-market futures are down as the stock market continues to struggle, with the Dow, Nasdaq, and S&P 500 all showing declines, while the 10-year bond yield remains high and the inverted yield curve persists. Job openings are expected to be flat in the JOLTS report for August, reflecting a decline from pre-pandemic levels, and job quits are at a 2.5-year low, indicating a decrease in employee confidence. This week's jobs data will provide further insights into the state of the economy, with interest rates and future Fed decisions being influenced by the upcoming Q3 earnings season.
U.S. job openings unexpectedly increased in August, driven by demand for workers in the professional and business services sector, pointing to a tight labor market that could push the Federal Reserve to raise interest rates next month.
According to a report by ADP, US employers added 89,000 new private-sector jobs in September, which is significantly lower than the expected 153,000 new hires. However, data from the Bureau of Labor Statistics showed a surge in available jobs, indicating a contrasting picture of the labor market.
The September employment report, set to be released on October 6th, is expected to show an addition of approximately 170,000 jobs, with economists closely monitoring unemployment and wage growth data. Eric Freedman, Chief Investment Officer at U.S. Bank Asset Management, states that the resilience of the broader economy lies in the labor market, which still faces challenges in finding workers, especially for small businesses.
The upcoming nonfarm payrolls report will test Wall Street's fears of a strong labor market potentially leading to high interest rates and a weak stock market, as economists predict a net increase of 170,000 new jobs in September.
The latest U.S. Jobs Report shows 336,000 new jobs added in September, exceeding expectations and indicating a strong economy that may lead to another rate hike from the Fed. Higher Treasury yields may result in more volatility in stocks and impact sectors such as mortgages and finance. However, this may also present attractive buying opportunities in beaten-down market sectors. Investors should conduct solid research and diversify their portfolios.
Recent layoffs in the tech sector have raised concerns about the job market, but there is evidence that Americans are still spending and businesses are quickly absorbing any job losses, indicating that there is no imminent crisis in the labor market, according to economists. The labor market is cooling from the post-pandemic boom, but it remains strong overall, and the recent layoffs are concentrated in specific sectors. Additionally, the Federal Reserve's high interest rates may slow down hiring, but experts do not expect a significant increase in unemployment or mass layoffs in the near future.
