Live Markets: Payrolls: what to expect across assets

Davide Campari Milano NV

01/08/2025 10:39

Stoxx 600 down 1.2%

Trump presses ahead with tariffs

US jobs data due

Wall St futures lower

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PAYROLLS: WHAT TO EXPECT ACROSS ASSETS

It's the first Friday of the month, which can only mean one thing: U.S. jobs day.

Economists survey by Reuters expect the U.S. to have added 110,000 nonfarm payrolls last month, a moderation from the 147,000 added in June. The unemployment rate is seen ticking up to 4.2%.

Citigroup notes that stocks tend to rally on payrolls day, with negative surprises tending to see a partial reversal.

"Equities tend to post small gains overall on the day, and even after announcement time, sell-offs have a positive drift," Citi's Alex Saunders writes.

Wall Street futures are weak this morning after Trump hit more countries with tariffs. Disappointing results from Amazon after market are not helping.

Looking at Treasuries, Saunders notes that they tend to sell off on the median of NFP days.

"The median case is a small negative return, there is a drift down on negative surprises," Saunders says.

On Thursday, the bank's FX strategy team recommended a long euro-dollar position heading into the payrolls report.

"The setup is attractive for USD shorts into labor market data, where downside risks for employment are increasing," the bank says.

"The recent FX positioning squeeze and hawkish Fed repricing provide better risk/reward for tactical EURUSD upside expressions into (the) NFP report."

(Samuel Indyk)

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EARLIER LIVE MARKETS POSTS:

STOXX SET FOR BIGGEST WEEKLY FALL IN FOUR MONTHS CLICK HERE

EUROPE BEFORE THE BELL: TARIFF JOLT  CLICK HERE

MORNING BID: 'TARIFFS - USE THIS VERSION, PLEASE'
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