US Jobs Day, Bad News Day for Britain
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What are the key market moves in the US and Europe this morning?
It's jobs day today in the United States and bad news for the UK. OK, they had a rate cut, but not enough for some from the Bank of England. And the yen is up again. It's Friday. It's the 7th of February, 2025. It's the Morning Call from NAB. Good morning. Well, the US dollar climbing today after a couple of sessions on the slide, but it's only 0.1% up. So let's not get too excited about that. The pound, though, that's down 0.5%. The euro is down just 0.1%. The Aussie pretty flat today at just above 62.8 US cents. US stocks, well, they were mixed ahead of the Amazon earnings. I'll tell you about those in just a moment. The Dow down 0.3% at close. The Nasdaq up. up 0.5%. The S&P up 0.4%. The Russell 2000 down 0.4%.
And we've seen big rises in Europe. The Euro stocks 50 up 1.6%. The DAX and CAC aren't both up 1.5% at close. The FTSE 100, though, closed up 1.2%. Amazon earnings Just after the US close, almost 115.6 billion is their net sales. That is a beat against 114.2, which was expected. Amazon Web Services up 19%. That was in line with expectations at 28.8 billion. I imagine a lot of people will be breathing a sigh of relief on that. But the bad news, first quarter net sales, they are saying just 151 billion against market estimates of almost 159 billion, which is perhaps why... Straight after the results were announced, Amazon shares were down almost 5%. Meanwhile, bond yields rising. US 10-year treasuries were up four basis points at 4.46% earlier.
They're down two basis points from that now, up five for 10-year gilts in the UK, up five in Canada as well. Aussie 10-years, which fell to 4.31% yesterday, are back up around 4.38% this morning. And oil moving down 0.7% off WTI, 0.5% off Brent at 74.30 a barrel. And gold falling back down today about 0.5% lower. So it is jobs day in the United States. Of course, non-farm payrolls tonight. Let's start there with Taylor Nugent from NAB in Melbourne. We had the ADP numbers on Wednesday, of course, which showed a rise in the number of jobs. 183,000 new jobs and the prior month substantially revised up. And does that, I mean, obviously, that's not necessarily going to be reflected in the numbers today. But what would it mean for the Fed if it was reflected in non-farm payrolls?
And we saw a much tighter market because, of course, we saw in jolts still plenty of jobs available.
Yeah. So, you know, that, as you say, kind of mixed signals from the second tier labor market data. You know, we know in the U.S. labor market at the moment, the pace of hiring has generally been reasonably subdued, but you've got layoffs that are pretty low. And so you've had reasonably healthy payrolls gains continuing. You know, the way that the Fed is looking at the labor market, it's in a reasonably good position. place. They don't think it will weaken much further. The unemployment rate was 4.1% in December. Expectations are that it will stay there in January in the data that prints tonight. They see it getting up to about 4.3% by the end of the year. So, they're not expecting too much movement in those indicators.
They also don't think the labour market is particularly a source of inflationary pressure at the moment.
How did Amazon’s earnings surprise affect stock markets?
So, you know, within... the realms of an unemployment rate broadly tracking sideways in a labour market that's kind of remaining healthy. You know, there's not too much in terms of near-term implications for the Fed, I don't think. In terms of what that kind of data flow this week so far, in terms of ADP, in terms of the... The jobless claims numbers we had last night,
a
little bit higher than expected within the realms of week-to-week volatility. I don't think any of these things are moving the dial too much in terms of payrolls for tonight. Expectations there are for a payrolls gain of $173,000. There's a lot of moving parts. January is a notoriously difficult payrolls number to forecast and payrolls always has an element of volatility. You've got kind of the strength from the hurricane rebound potentially supporting some of those strong payrolls gains we've had.
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Chapters
4 chapters
1
What are the key market moves in the US and Europe this morning?
0:01–3:14
2
How did Amazon’s earnings surprise affect stock markets?
3:14–7:13
3
What does the ADP report suggest for tonight’s US non‑farm payrolls?
7:13–11:03
4
How are US labor market trends influencing the Fed’s policy outlook?
11:03–13:22