The U.S. added 150,000 jobs in October versus economist expectations for 180,000 and down from 297,000 in September. The unemployment rate rose to 3.9% versus forecasts for 3.8% and September’s 3.8%.
In addition to the headline miss, downward revisions to August's and September's jobs gains totaled 101,000.
Bitcoin (BTC) remained lower on the session in the immediate aftermath of the release at $34,300.
Checking other report details, average hourly earnings were 0.2% higher in October, shy of estimates for 0.3% and September's 0.3%. On a year-over-year basis, average hourly earnings rose 4.1% versus 4.0% expected and 4.3% in September.
The U.S. bond market has quickly turned tail over the past two weeks, moving from panicky selling action to the idea that Federal Reserve rate hikes are over this cycle, making the coast clear to begin adding fixed income to portfolios. After pushing through 5% on Oct. 19, the 10-year Treasury yield had tumbled back to 4.64% prior to this employment news. The two-year Treasury yield has slid a similar amount, yielding 4.97% ahead of the report.
Falling yields have been a boon to stocks, which have pulled out of a slump begun in late July. The S&P 500 and Nasdaq are each higher by about 5% over the past few sessions. Similarly so for bitcoin. The recent bull move for the crypto has been attributed to what could be imminent approval of a spot ETF, but to the extent that falling interest rates reignite animal spirits in risk assets like stocks, bitcoin would seemingly also benefit.
Following the report, U.S. stock index futures have turned from negative to positive, with the S&P 500 and Nasdaq each higher by about 0.45%. Treasury yields have whooshed down even further, the 10-year lower by 12 basis points to 4.54% and the 2-year off 10 basis points to 4.87%. A check of the CME FedWatch tool shows the odds of a rate cut as soon as March 2024 have jumped to 20% against just 13% prior to this morning's number.
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