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Jobs Week Pushed Later; Markets Await Fed Minutes

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Even though this is officially “jobs week” — that initial week in a month that beings us private-sector jobs totals, weekly jobless claims, JOLTS data, non-farm payrolls and a fresh unemployment rate — none of the labor force statistics are yet released; they’ve been moved to Thursday and Friday, in order to accommodate for this week’s holiday-disrupted series of trading days. These include a new Automatic Data Processing (ADP - Free Report) report on the private sector and the U.S. government’s Employment Situation.

Pre-market futures are in a giving mood this morning: particularly, giving back some of the gains the equities markets have made off recent lows from a week ago Tuesday. Markets are up anywhere from +1.3% (Dow) to +2.5% (Russell 2000) over this time period, but currently the Dow is -190 points, the S&P 500 is -25, the Nasdaq -95 and the small-cap Russell 2000 is -13 points.

Before the new jobs reports start coming out in about 24 hours from now, we’ll first see the minutes to the last Fed meeting, where the monetary policy body decided to pause on interest rate hikes for the first time in 11 meetings, now in a range of 5.00-5.25% — the highest interest-rate level in more than 15 years. We know from subsequent speeches and addresses given by Fed Chair Jay Powell and others that the Fed was not finished considering new rate hikes; we can parse the level of agreement or lack thereof in the detailed minutes today at 2pm ET.

In the near-term, labor force totals will be the most immediate driver to potentially sway the Fed’s decision. Currently, ADP expects +220K new private-sector jobs having been created last month, while the U.S. Bureau of Labor Statistics (BLS) is looking for +240K job gains overall, with a 3.6% Unemployment Rate. However, results have been coming in hotter than expectations for the past couple months, after it appeared we were headed toward sub-200K new jobs created for the first time since early 2022. We’ll see if this robust trend continues, or if job gains indeed start becoming more scarce, as analysts have been predicting much of this year.

Other economic prints awaiting us for the remainder of this week include Factory Orders later this morning and a new U.S. trade deficit tomorrow — both for May. Also S&P and ISM Services PMI are out tomorrow for the month of June. But nothing rates as high this week as the BLS numbers, including hourly wage growth and labor force participation. And nothing would be more likely to cool the Fed’s rhetoric on rate hikes like a notably sub-par BLS jobs report Friday.

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