US open: September jobs data upends hopes for 'Goldilocks' non-farm payrolls report
Wall Street's main market gauges were knocked lower by the release of a September non-farm payrolls report that did little to dissuade traders from their view that the central bank might yet hike short-term rates by another 75 basis points in November, although that was not yet certain.
Nonetheless, even if hiring continued to be "very rapid" the details of the report were perhaps less robust, some economists ventured.
As of 1634 BST, the Dow Jones Industrials had fallen by 1.57% or 469.37 points to 29,457.57, while the S&P 500 was down by 2.07% or 78.16 points to 3,665.47.
The Nasdaq Composite meanwhile was trading off by 2.91% or 321.42 points to 10,751.89.
The yield on the benchmark 10-year US Treasury note was up by five basis points to 3.874%, having earlier reached 3.91%.
Front-dated West Texas Intermediate crude oil futures were also climbing, adding 2.94% to $91.39 a barrel on the ICE.
The US dollar index was roughly flat and Fed funds futures were indicating a 75.6% probability of 75bp rate hike when the Federal Reserve next met on 2 November.
According to the US Department of Labor, non-farm payrolls increased by 263,000 in September (consensus: 250,000), alongside a two tenths of a percentage point drop in the rate of unemployment to 3.5% (consensus: 3.7%).
Average hourly earnings meanwhile were up by 5.0% year-on-year (consensus: 5.1%) and the labour force participation rate dipped from 62.4% to 62.3%.
For Ian Shepherdson, chief US economist at Pantheon Macroeconomics, there were perhaps very preliminary signs of slower wage growth and the trend in participation was still higher, notwithstanding Friday's numbers.
"The household data are meaningless month-to-month, but that doesn’t stop the Fed looking at the data and discussing them as though they mean something," he said.
"And with Chair Powell now just as obsessed with the labor market as with the current inflation data, this report just about nails-on a 75bp hike next month. Things might look different by December."
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