background image background image background image

NY Open: Markets underwhelmed by nonfarm payrolls

Equities 4 minutes to read
MO
Michael O’Neill

FX Trader, Loonieviews.net

Summary:  A soft US jobs report only added to markets' unease today, with both forex and equities moving into risk-off territory following the lacklustre print.


Markets eagerly awaited this morning’s release of the November nonfarm payrolls report. The employment component of the ISM non-manufacturing report was robust and expectations of heavy Thanksgiving holiday hiring led to predictions of an upward surprise to the 200,000 jobs forecast.

There was a surprise, but it wasn’t upward.

November employment rose 155,000, and the unemployment rate was unchanged at 3.7%. FX markets were underwhelmed. The US dollar was sold across the board, but the moves were shallow, and as of 1400 GMT the gains were marginal.

EURUSD rallied from 1.1370 to 1.1410 and then dropped to 1.1390 while GBPUSD and USD JPY retraced all their post NFP moves.

USDCAD was the biggest loser today, dropping from 1.3390 to 1.3261 as of 1345 GMT. Canada added a jaw-dropping 94,100 new jobs in November and 89,000 were full-time. The data was a ray of sunshine after a week which saw WTI oil prices flirting with $50.00/barrel and a clear dovish flip-flop by the Bank of Canada. The plunge was worsened by stop losses being triggered on the break of 1.3340 and 1.3280. Longer term, fears about the impact of soft oil prices on the domestic economy, the risk of reprisals by China for Canada’s arrest of the Huawei CFO, downgraded rate hike expectations and uptrend line support at 1.3200 will limit USDCAD losses.

Wall Street has fallen into the red, and traders are anxious that China may walk away from the trade war truce considering the Huawei arrest. 

It is going to be another busy week with major data competing with the UK Parliament vote on Prime Minister Theresa May’s Brexit plan and the impact of the Italy budget dispute at the European Union council meeting. Other factors are the final Opec production quota decision and Washington politics.
US dollar index
Source: Saxo Bank
Disclaimer

Saxo Capital Markets (Australia) Limited prepares and distributes information/research produced within the Saxo Bank Group for informational purposes only. In addition to the disclaimer below, if any general advice is provided, such advice does not take into account your individual objectives, financial situation or needs. You should consider the appropriateness of trading any financial instrument as trading can result in losses that exceed your initial investment. Please refer to our Analysis Disclaimer, and our Financial Services Guide and Product Disclosure Statement. All legal documentation and disclaimers can be found at https://www.home.saxo/en-au/legal/.

The Saxo Bank Group entities each provide execution-only service. Access and use of Saxo News & Research and any Saxo Bank Group website are subject to (i) the Terms of Use; (ii) the full Disclaimer; and (iii) the Risk Warning in addition (where relevant) to the terms governing the use of the website of a member of the Saxo Bank Group.

Saxo News & Research is provided for informational purposes, does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. No Saxo Bank Group entity shall be liable for any losses that you may sustain as a result of any investment decision made in reliance on information on Saxo News & Research.

To the extent that any content is construed as investment research, such content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication.

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments.Saxo Capital Markets does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo Capital Markets or its affiliates.

Please read our disclaimers:
- Full Disclaimer (https://www.home.saxo/en-au/legal/disclaimer/saxo-disclaimer)
- Analysis Disclaimer (https://www.home.saxo/en-au/legal/analysis-disclaimer/saxo-analysis-disclaimer)
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)

Saxo Capital Markets (Australia) Limited
Suite 1, Level 14, 9 Castlereagh St
Sydney NSW 2000
Australia

Contact Saxo

Select region

Australia
Australia

The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit www.home.saxo/en-au/about-us/awards

Saxo Capital Markets (Australia) Limited ABN 32 110 128 286 AFSL 280372 (‘Saxo’ or ‘Saxo Capital Markets’) is a wholly owned subsidiary of Saxo Bank A/S, headquartered in Denmark. Please refer to our General Business Terms, Financial Services Guide, Product Disclosure Statement and Target Market Determination to consider whether acquiring or continuing to hold financial products is suitable for you, prior to opening an account and investing in a financial product.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Saxo Capital Markets does not provide ‘personal’ financial product advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo Capital Markets does not take into account an individual’s needs, objectives or financial situation. The Target Market Determination should assist you in determining whether any of the products or services we offer are likely to be consistent with your objectives, financial situation and needs.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the US and other countries. AppStore is a service mark of Apple Inc.

The information or the products and services referred to on this website may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and Services offered on this website is not intended for residents of the United States and Japan.

Please click here to view our full disclaimer.