As the non-farm employment report for this month is about to be released, the importance of this data is self-evident. As the last critical economic data before the Fed's interest rate decision in December, its impact on market trends and policy expectations is closely watched.
Wall Street generally expects that the non-farm new employment in November will be 220,000, far higher than the sluggish performance of 12,000 in October. Affected by temporary factors such as hurricanes and strikes, the job market was almost stagnant in October, but as these factors subside, the data in November may see a significant rebound.
Market Expectations: Employment Data Will See Significant Rebound
According to forecasts from multiple investment banks, the non-farm data in November may be between 150,000 and 284,000. Goldman Sachs expects an increase of 235,000, while Bank of America and JPMorgan's forecasts are more optimistic, at 240,000 and 275,000 respectively. The market also expects the unemployment rate to remain at 4.1%, with wage growth up 3.9% year-on-year, slightly lower than the previous value.
It is worth noting that as the year-end approaches, seasonal hiring in the retail industry is relatively weak, and the delayed start of the Thanksgiving and Black Friday shopping season may have a certain negative impact on the employment data. Goldman Sachs estimates that this delay may lead to a reduction of 15,000 in retail employment.
Policy Signals Behind the Data
This non-farm data is of great significance to the Fed, as it is not only a key indicator of economic health, but also an important basis for adjusting policy direction. The market generally expects the Fed to cut interest rates by 25 basis points in December, and the non-farm data will provide strong support for this decision.
Fed Governor Waller recently stated that the labor market is tending towards balance, and he supports a slight rate cut in December. This statement has made the market more focused on the upcoming non-farm data and the policy signals it may release.
Market Reaction: Bad News is Good News?
On Wall Street, the performance of the employment data will directly affect the short-term market trend. Goldman Sachs' traders expect that if the new employment number is between 150,000 and 200,000, it will be seen as a positive signal, and the S&P 500 index is expected to rise 50 to 100 basis points; if the data exceeds 275,000, it may trigger a market decline, as this will increase the likelihood of the Fed continuing its tightening policy.
Here is Goldman Sachs' reaction matrix:
- Over 275,000: S&P 500 index down more than 100 basis points
- 200,000 to 235,000: S&P 500 index flat or slightly fluctuating
- Below 150,000: S&P 500 index may rise
Morgan Stanley's market team, however, holds a more optimistic view. They expect 275,000 new jobs in November and believe that strong employment data will provide momentum for the year-end rebound in US stocks. Morgan Stanley expects the S&P 500 index to have an additional 2.8%-4.4% upside potential this year.
Gold Market and Performance of Other Assets
Prior to the release of the non-farm data, the gold market has shown a cautious stance. Analysts point out that if the employment data performs strongly, the US dollar may further strengthen, which could put downward pressure on gold prices. However, if the data is weak, it may provide short-term support for gold.
Technical analysis shows that gold prices are currently fluctuating between key support and resistance levels. If it breaks below the $1,630 support, it may further test $1,600 or even lower; while the upside breakthrough of $1,700 will require macro-positive drivers.
Summary
Regardless of how the non-farm data ultimately performs, its impact on market sentiment and policy expectations will be the core driving force in the short term. BTX Insight will continue to closely monitor the market reaction after the release of the non-farm data and provide in-depth analysis for users. At the same time, traders need to be alert to the market risks brought by data fluctuations and optimize their trading strategies in line with policy trends.
The above content is from public market information and is for reference only, and does not constitute any investment advice. The cryptocurrency market has high risks, and investment requires caution.
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