US April payrolls rise more than expected, wages rise less than March
2022.05.06 16:19
FILE PHOTO: A job seeker talks to a representative from Signature Flight Support at a job fair for airport related employment at Logan International Airport in Boston, Massachusetts, U.S., December 7, 2021. REUTERS/Brian Snyder
NEW YORK (Reuters) – U.S. job growth increased more than expected in April, underscoring the economy’s strong fundamentals despite a contraction in gross domestic product in the first quarter.
Nonfarm payrolls rose by 428,000 jobs last month, the Labor Department said on Friday. Data for March was revised down to 428,000 jobs added from 431,000. Economists polled by Reuters had forecast payrolls rising by 391,000 jobs. The unemployment rate was unchanged at 3.6%.
The jobs-workers gap widened to an all-time high of 3.4% of the labor force from 3.1% in February. Average hourly earnings increased 0.3% after advancing 0.5% in March.
MARKET REACTION:
STOCKS: S&P e-mini futures briefly turned positive then down 0.55%, pointing to a weak open on Wall Street
BONDS: The yield on the benchmark 10-year note rose to 3.1126%; Two-year Treasury yields rose to 2.7349%,
FOREX: The dollar index turned 0.19% firmer
COMMENTS:
MATTHEW TUTTLE, CHIEF INVESTMENT OFFICER, TUTTLE CAPITAL MANAGEMENT, GREENWICH, CONNECTICUT
Futures “are stronger than they were. The only thing I would be concerned about from a market standpoint is a lot of times on these announcements the first move is usually wrong. I would be watching for a selloff. All in all a positive number. Certainly if you are sitting there worrying about a recession, at least initially, I don’t think there’s anything in here that would say the economy is in the tank. So far so good.”
“The unemployment rate being 3.6% after 12 months in a row of adding over 400,000 jobs, to me that’s an economy that’s cranking. I’m in the camp of ‘worried about a recession’ but looking at these numbers there isn’t anything that’s showing weakness.”
PETER CARDILLO, CHIEF MARKET ECONOMIST, SPARTAN CAPITAL SECURITIES, NEW YORK
“The topline number was more than expected but within the range of expectations. And the fact that hourly wages were lower than expected should be good for the bond market and that in turn should be good for the stock market.”
“The (decrease in the) participation rate is not terrible news, in that it suggests the labor market might not tighten any further.”
“As far as the Fed is concerned, the (stock market) moves we’ve been seeing are due to the fact that the Fed really doesn’t have the market’s confidence. The speculators are betting on how much the Fed is going to have to raise rates and whether inflation will make Powell cave and raise interest rates by 75 basis points.”
“The good news is that wages were not going up as fast as they were and that should begin to calm down that speculation. The market will have to recognize that maybe inflation is peaking. For now, unfortunately, the markets are testing the will of Powell and the Federal Reserve and are speculating against him.”
“You have to realize what happened yesterday was a test to the market’s technical aspect. Today’s employment data is going to be critical. If we can bounce off this 4100 level and close above it, that could mean the technical deterioration will have ended.”
(Compliled by the global Finance & Markets Breaking News team)
