NEW YORK (awp international) – According to the eagerly awaited US labor market report, Wall Street on Friday initially looks like a very subdued start for the Dow Jones Industrial. Around three quarters of an hour before the start of trading, the broker IG valued the US leading index with plus 0.04 percent at 34769 meters. For the technology-heavy Nasdaq 100, however, a slightly more significant increase of 0.4 percent to 14,964 counters was expected.
Just the day before, Wall Street had resumed its latest recovery rally with vigor after a temporary deal had been reached in the political dispute over the debt ceiling. This seems to have averted the impending default by the US government with potentially catastrophic economic consequences for the time being.
Before the weekend, investors are now turning their attention to the US labor market data and, at the same time, to the burning question of the future monetary policy of the US Federal Reserve. “This labor market report will give central bankers a headache,” commented Thomas Altmann from asset manager QC Partners in an initial assessment. “Although the unemployment rate has fallen to 4.8 percent, the lowest level in the post-pandemic era. At the same time, the increase in new jobs is lower than ever this year.”
In September, 194,000 new jobs had been created outside of agriculture in the United States, up from half a billion by experts. Since the development of the US labor market is an important indicator for the Fed, the September data is of great importance. This is all the more true since the monetary authorities had already announced a slow reduction in their billion-dollar bond purchases in view of the economic recovery from the Corona crisis. The only puzzles on the market were the beginning of what is known as tapering.
According to Altmann, the tapering traffic light remains on “yellow”. Ulrich Wortberg from Helaba, on the other hand, sees “no reason for the Fed to postpone the curtailment of bond purchases announced for November”.
On the corporate side, specific messages are rare on Friday. The eyes are already directed towards the coming week, when the reporting season is rolling in in the USA. US banks JPMorgan and Wells Fargo will be among the first to present their figures./tav/nas
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