US Open: What is expected from the NFP today?

US markets look set to open mildly higher with high expectations ahead of the upcoming US NFP unemployment report. Economic data was not entirely supportive yesterday with unemployment claims higher and the trade deficit wider than expected. Futures suggest the S&P500 will open 4 points higher at 1,892 with the Dow Jones expected to open 27 points higher 16,599. Earlier in the week the ADP employment report came in slightly below expectations at 191k new jobs in March, while yesterday the employment component for the services ISM indicator suggested a rebound in March. With this in mind, some are predicting numbers as high as 275k for today’s jobs report. The consensus is for 199k jobs created in March with a drop in the unemployment rate to 6.6% with average hourly earnings expected to increase by 0.2%. The Dow made a fresh intraday all-time high yesterday and it’s likely that any number 190k plus in today’s jobs report will help the US benchmark make a new all-time closing high. Any number above last month’s 175k should eventually be taken well but stocks may suffer a sell-off in the interim with gold likely to do the opposite of stocks. The FOMC Chair Janet Yellen has figuratively speaking opened trading on the next contract of the ‘Bernanke put’ after her ultra-dovish comments earlier this week. This means continued tapering of asset purchases is being accepted by markets with the knowledge that the Fed is still very accommodative and can stop tapering anytime if the US recovery starts to look shaky. The result is that even though today’s result is important for the US recovery, saving a complete disaster, say below 100k jobs created, tapering of asset purchases is probably going to happen at the next FOMC meeting regardless. GrubHub (GRUB) sees its IPO on the NYSE today priced at $26 per share, this comes on the same day Just Eat (JE), its counterpart across the pond lists on the UK’s AIM market. Google will have its next day of trading after the stock split created the new voting C share. CMC Markets is an execution only provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.