Traders Eye FTSE as September Non-farm Payroll Results Announced
LONDON, October 7, 2011 /PRNewswire/ --
Following the non-farm payroll report on 7th October, Joshua Raymond of City Index (http://www.cityindex.co.uk/) summarised the better-than-expected jump which helped the FTSE 100 to trade higher by 1% having been largely flat on the day.
Mr. Raymond, Chief Market Strategist of spread betting provider City Index, explains: "US non-farm payrolls increased by 103,000 in September, higher than the initially expected 60,000 jobs, whilst August's previous flat reading was also revised higher to 57,000. Private payrolls jumped 137,000 which also beat consensus forecasts of 100,000, whilst the US unemployment rate remained flat at 9.1%."
"This is one of the better jobs reports given that investors have had to deal with multiple jobs data disappointment over the last few months."
Some traders had anticipated this jobs report could be better than expected, said Joshua Raymond, considering it was set to include the returning Verizon jobs strikers that negatively impacted August's jobs report.
"Much of the US economic data this week has outperformed market expectations," continued Mr. Raymond. "And this is giving investors some nice medication after the turmoil seen in stock markets since August. This, aligned with a seemingly united front in Europe to top up bank liquidity is helping to maintain the stock market rally we have seen in the last three days.
"That said, we need greater evidence than one month's worth of outperforming US jobs data to help ease some of the investor concerns about a US slowdown in activity and the payroll data was not enough to move the US unemployment rate from a stubbornly high 9.1%."
In concluding his overview of the nonfarm payroll report, Joshua Raymond considered the impact of the announcement on the FTSE 100. "The FTSE 100 has rallied nearly 10% from Tuesday's lows and whilst this is impressive and welcoming, the UK Index is now nearing the same resistance levels which had seen the FTSE sell off from over the past two months. If the FTSE 100 can break through 5400 and 5450, then this could certainly indicate that this stock market rally has legs but until then, it will be hard to convince investors that this week's bounce is anything more than just that, a bounce."
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SOURCE City Index
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