U.S. nonfarm payrolls slightly beat market expectations in August, but slowing wage growth and a rise in the unemployment rate eased some concerns regarding inflation and the Federal Reserve’s likely next move to raise interest rates sharply , US stocks opened higher on Friday (2nd).
Before the deadline,Dow Jones Industrial Averagerose more than 100 points or 0.41%,Nasdaq Composite Indexup 20 points or 0.17%,S&P 500 Indexrose nearly 0.5%,Philadelphia SemiconductorThe index rose nearly 0.4 percent.
The U.S. non-farm payrolls reported 315,000 in August, slightly higher than market expectations of 300,000, but far below the revised pre-value of 526,000, and wage growth also declined last month, coupled with the August unemployment rate It traded at 3.7%, beating market expectations of 3.5% and up from 3.5% in July.
Combined with the recently released ADP report, known as the “small non-farm farmer”, the US job market may have cooled. Data showed that the US ADP employment increased by 132,000 in August, far below the expected 300,000 and July’s 270,000.
After the data was released, U.S. two-year bond yields fell from 14-year highs, falling regarding 6 basis points to 3.463%, mainly because the August non-farm payrolls report was close to expectations, easing the market’s warming of the labor market will force the Federal Reserve (Fed). ) continued to raise interest rates sharply to curb inflation concerns, while the U.S. 10-year Treasury yieldSteady at 3.271 percent, the 30-year yield rose 3 basis points to 3.404 percent.
However, some market analysts pointed out that the employment report did not change the path of traders to the Fed to raise interest rates sharply. Because a slew of reports this week including the Conference Board’s August Consumer Confidence Index, July’s JOLTs Job Openings, and August’s ISM Manufacturing Index all confirm the Fed’s claim that the U.S. economy is strong enough to withstand more policy tightening .
Global bond markets plunged into a bear market for the first time in more than 30 years as soaring inflation forced central banks to rapidly raise interest rates. The Bloomberg Global Aggregate Total Return Index, which tracks Treasuries and investment-grade corporate bonds, has pulled back more than 20 percent from its January high, the biggest drop since the index was launched in 1990.
In terms of individual stocks, Berkshire Hathaway, a subsidiary of Warren Buffett, recently sold BYD (002594-CN)(1211-HK) 1.716 million shares, and the shareholding ratio dropped from 19.02% to 18.87%. It was sold once more in less than a month following the first sale of BYD’s shares on August 24.
In other news, according to foreign media reports, the finance ministers of the Group of Seven (G7) countries have reached a consensus today to set a price ceiling for Russian oil, on the one hand, limiting the Kremlin’s ability to finance the Russian-Ukrainian war, on the other hand, to control the soaring oil price. energy prices. Before the deadline, international oil prices rose nearly 3%.
As of 21:00 on Friday (2nd) Taipei time:
Stocks in focus:
Lululemon (LULU-US) rose 10.21% to $324.50 a share in early trade
Yoga and high-priced sportswear giant Lululemon reported strong earnings last quarter, with revenue increasing 29% to $1.9 billion and adjusted earnings per share of $2.2, both beating market expectations of $1.774 billion and $1.9 billion. $1.87.
In addition, the company is also optimistic regarding the future operating outlook and raised its financial forecast. It is estimated that the annual revenue will be in the range of 7.865-7.94 billion US dollars, which is higher than the analyst’s estimate of 7.7 billion US dollars. Better than market expectations of $9.44.
Broadcom (AVGO-US) rose 2.84% to $506 a share in early trade
Chip maker Broadcom’s revenue rose 25 percent to $8.464 billion last quarter, beating consensus estimates of $8.41 billion. Adjusted earnings per share were reported at $9.73, also beating expectations of $9.57. The company’s future financial forecast is also quite bright, with an expected fourth-quarter revenue increase of 20% to 8.9 billion US dollars, higher than the expected 8.72 billion US dollars.
Bed Bath & Beyond(BBBY-US) fell 5.08% to $8.27 a share in early trade
U.S. homeware retailer Bed Bath & Beyond fell nearly 6 percent in premarket trading, on track for a fourth straight session of losses. Bed Bath & Beyond’s announcement on Wednesday of a series of measures to boost the company’s financial health did not appear to be favored by investors.
Today’s key economic data:
- Non-agricultural employment reported 315,000, expected 300,000, the previous value was revised down from 528,000 to 526,000
- Unemployment rate at 3.7%, expected 3.5%, previous value of 3.5%
- Average weekly hours worked 34.5 hours, expected 34.6 hours, previous value 34.6 hours
- The average hourly wage growth rate was reported at 5.2%, expected 5.3%, the previous value of 5.2%
- The monthly growth rate of average hourly wages was reported at 0.5%, expected 0.4%, and the previous value was 0.5%
- The labor force participation rate was reported at 62.4%, expected 62.2%, and the previous value was 62.1%
- U.S. July durable goods orders revised monthly rate of -0.1%, expected 0%, the previous value of 0%
- U.S. July factory orders monthly rate reported -1.0%, expected 0.2%, the previous value of 2%
Wall Street Analysis:
Meera Pandit, global market strategist at JPMorgan Asset Management, said there isn’t much reason to be bullish in a bearish environment in the weeks and months ahead. However, these are levels that can pay off in the long run when longer-term prospects and longer-term investors are considered.
Fears that rising interest rates will hurt economic growth have weighed on markets, pushing the Bloomberg Global Total Return Index, which measures government and investment-grade corporate bonds, down more than 20 percent from its 2021 peak. Giles Coghlan, chief foreign exchange analyst at HYCM, said that the market is highly focused on how much the Fed will take in the rate hike cycle. The market’s three current priorities are: China’s economic slowdown,EURRegional recession, and the Fed’s hawkish stance.
Jim Solloway, senior market strategist at SEI, said that while higher interest rates may be painful for bondholders in the short term, ceteris paribus, higher yields will ultimately mean higher nominal incomes and returns.
Richard Flynn, UK managing director at Charles Schwab Corporation, said the unemployment rate remained relatively low in August, but that was likely due to low labor force participation rather than a booming economy. He also said that investors will note that the jobs report is a lagging indicator that tends to be strong when entering a recession. In fact, broader economic indicators have been weakening recently.
