The highly anticipated Nonfarm Payroll report, which is published on the first Friday each month by the U.S. Bureau of Labor Statistics showed that the U.S. economy added 263K jobs in September 2022, which came slightly above market forecasts of 250K, and marked a moderate decline from the unrevised 315K print the prior month. This is the lowest reading since April 2021 and shows a decline from an average of 420K in the first eight months of 2022, and below the monthly average of 562K in 2021, showing that the current interest rates hiking cycle and higher prices have started to impact the economy.
The U.S. unemployment rate fell to 3.5% coming in below market expectations and the August print of 3.7%, which shows that the labor market remains tight, which could give room to the Fed to stick to its interest rate hikes projections.
Average hourly earnings for all employees on private nonfarm payrolls in the U.S. rose by 10 cents, to $32.46 in September 2022. This is a monthly growth of 0.3%, which came in line with market forecasts and remained unchanged from August. The yearly average hourly earnings decreased to 5% from 5.20% in August and are well behind the annual rate of inflation.
Investors are scratching their heads if the slowing economy would influence the Federal Reserve to abandon its interest rate hikes earlier, and at a lower terminal level, than what the central banks is currently predicting. Whether this number will have a significant impact on the Fed’s monetary decision in November is unclear, but September’s CPI data scheduled to be released on 13th of October 2022 should provide more clues. Last week Fed officials kept repeating that they remain committed to tame inflation which is at 40-year high, with more rate hikes, even at the cost of tipping the economy into a recession. Fed officials warned against betting on an early ‘pivot’ from the central bank and signalled last month that additional 125-basis point increase by year end is on the cards.
Job openings were released earlier in the week showing a decline in August amid a slowdown in overall demand. The number of job openings has dropped by almost 2 million from the peak of 11.9 million in March when the Fed’s first-rate hike in the current cycle took place. Equity market took a reprieve rally on hopes the Fed might take its foot off the accelerator; however, such hopes on an interest rate pivot appears to be premature, as job openings continue to be elevated.
The U.S. weekly jobless claims were slightly higher than expected, indicating some softness in the labor market. However, the data is still overall low and is unlikely to interfere with the Fed plans to continue its aggressive rate hikes. With labor market still tight and unemployment rates close to multi-decade lows, anxiety among investors is growing over the possibility that the Federal Reserve won’t change its hawkish stance, even as evidence the U.S. economy is cooling.
The S&P 500 index which gives a better representation of the broader U.S. economy traded sharply lower on Friday and we see a good probability of the decline extending further in the next few trading sessions. The daily stochastic indicator has turned down from overbought levels supporting our view that another short-term decline is underway. Once the current down swing is complete a mild rebound could be seen as the weekly momentum readings are in oversold territory. Overall, the price structure and the momentum conditions are in poor state and our medium-term view on the market remains bearish. We see levels to 3,400 in the coming month(s) as easily achievable.
Violeta è entrata a far parte di Leverage Shares nel settembre 2022. È responsabile dello svolgimento di analisi tecniche e ricerche macroeconomiche ed azionarie, fornendo pregiate informazioni per aiutare a definire le strategie di investimento per i clienti.
Prima di cominciare con LS, Violeta ha lavorato presso diverse società di investimento di alto profilo in Australia, come Tollhurst e Morgans Financial, dove ha trascorso gli ultimi 12 anni della sua carriera.
Violeta è un tecnico di mercato certificato dall’Australian Technical Analysts Association e ha conseguito un diploma post-laurea in finanza applicata e investimenti presso Kaplan Professional (FINSIA), Australia, dove è stata docente per diversi anni.
Julian è entrato a far parte di Leverage Shares nel 2018 come parte della prima espansione della società in Europa orientale. È responsabile della progettazione di strategie di marketing e della promozione della notorietà del marchio.
Oktay è entrato a far parte di Leverage Shares alla fine del 2019. È responsabile della crescita aziendale, mantenendo relazioni chiave e sviluppando attività di vendita nei mercati di lingua inglese.
È entrato in LS da UniCredit, dove è stato responsabile delle relazioni aziendali per le multinazionali. La sua precedente esperienza è in finanza aziendale e amministrazione di fondi in società come IBM Bulgaria e DeGiro / FundShare.
Oktay ha conseguito una laurea in Finanza e contabilità ed un certificato post-laurea in Imprenditoria presso il Babson College. Ha ottenuto anche la certificazione CFA.