All’s Quiet Before the Payrolls Report
S&P 500 futures: There is a slight bid on e-mini S&P 500 futures this morning, as traders gear up for a rebound in non-farm payrolls in September. Expectations are for payrolls to have increased by 100,000 jobs in September, a sharp rebound from the loss of 4,000 jobs in August. However, many believe that an increase in government jobs will account for the bulk of any rise, as private sector job growth lags behind. In early trade, December e-mini S&P 500 futures are trading at 1556.25, up 4.00.
Dollar Index: December Dollar index futures are trading moderately lower, as traders look for the unemployment rate to rise by 0.1% to 4.7% in today’s jobs report. Traders expect the manufacturing, construction, and financial services sectors to be a drag on employment, keeping alive the possibility of further interest rates cuts in the remaining weeks of 2007. In early trade, December Dollar Index futures are trading at 78.280, down 0.100.
Treasury futures: After closing near the highs of the session yesterday, Treasury futures are moderately lower as traders await the non-farm payrolls report. Average hourly earnings are expected to increase by a moderate 0.3% – the consensus figure for almost every month. If the report shows a bigger increase in wages, Treasuries may be on the defensive as wage inflation creeps back into the spotlight. In early trade, December Ten-year Note futures are trading at 109-180, down 0-02.
Mike Zarembski, Senior Commodity Analyst
