Quarterly Outlook
Macro outlook: Trump 2.0: Can the US have its cake and eat it, too?
John J. Hardy
Global Head of Macro Strategy
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Morning Brew September 6 2024
Erik Schafhauser
Senior Relationship Manager
Summary: Will the Nonfarm Payroll be as bad as the ADP yesterday?
Good morning.
On Monday I will be off for a Swiss Holliday, Tuesday will be the next update.
A lower-than-expected ADP yesterday boosted hopes for a 50 Basis point hike, but the nonfarm Payroll data today will need to confirm that. If the basic scenario remains that the Fed wants to cut by 50 BPS, we need dovish data today.
The expectations are:
Nonfarm payrolls 160,000
Unemployment rate to fall to 4.2% from 4.3%
Average hourly earnings up 3.7% on the year.
Please find our Stats Teams Preview here
Donald Trump proposes a government efficiency commission headed by Elon Musk and low-tax housing zones and corporate tax cuts for domestic manufacturers, the D
Yesterday the Dow ended lower by 0.54%, the S&P 500 0.30%, the Nasdaq gained 0.25%. Tesla gained almost 5% on good news on its assisted driving, Nio rose 14% and JetBlue could gain 7% after earnings. After hours Broadcom beat expectations but lost 6.7%. Volumes were in line with the average.
10-year yields fell to 3.70 and the USD Index is under pressure, EURUSD retook the 1.11, GBPUSD is 1.3180 and USDJPY 142.70.
Gold and Silver had a strong day yesterday, Gold could rise above 2500, and Silver briefly traded above the 29, now both are 2520 and 28.85 despite oil remaining weak.
Bitcoin is trading at 56500 and ETH 2385.
The probability of a 50 BPS cut in 2 weeks is 43% now, the year end is seen at -110 basis points and June 2025 at 210. Any shift here will be the market mover after the nonfarm payroll today.
There could be a lot of volatility not only right after the release of the data at 14:30 CET but also in the aftermath when all the underlying data points are being analyzed and considered. We have seen quite a few Fridays where we saw a lot of movement in a late Friday.
Consider if you want to trade the event of if you want to stay aside. If you want to trade it, consider your risk! Consider options for a non-linear payout!
On Monday we are expecting Chinese Inflation data, the Apple Event with the iPhone 16 and the first Harris/Trump debate.
Friday
- Data DE Industrial Output EU GDP US Nonfarm Payrolls
- Earnings: Williams
Monday
- Data China PPI&CPI
Trum/Harris Debate
Apple Event
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