DAN COOK, SENIOR MARKET ANALYST, IG MARKETS, CHICAGO:
“The headline number looks pretty bad but it looks like that was almost all government. The market is still having a tough time - a lot of people were looking at this to see what the Fed would do. So the market is left to kind of scratch its head and say which way does the Fed go now? Because private payrolls, while still not at that 100,000 threshold where we would like to be, we did have a nice revision in the pervious month to 93,000. Overall, it wasn’t terrible when we look at the private payrolls.
“This wasn’t a defining answer at all for any type of speculation on what the Fed may do. Not great, but still somewhat stable over the last few releases.”
TOM SOWANICK, CHIEF INVESTMENT OFFICER, OMNIVEST, PRINCETON,
NEW JERSEY:
“The market was looking for a number that was much weaker or stronger than consensus -- and it got neither. The focus today will be on currencies ahead of the G7/IMF meeting. My guess is that when the day is done, you are going to have both bonds and stocks rallying. There is enough information in the data to support the notion that the Fed will be doing some kind of quantitative easing and that promotes more risk-taking, if you will.”
KEVIN FLANAGAN, CHIEF FIXED INCOME STRATEGIST, MORGAN STANLEY
SMITH BARNEY, PURCHASE, NEW YORK:
“To me this was all about a referendum for QE2. Was there anything in this report that would possibly give the Fed pause? It doesn’t appear that way.”
“Treasuries’ reaction: after initially having a bit of trepidation going into the number after confusing Fed comments of late, the Treasury market is rallying because this report continues to suggest odds favor the Fed does announce QE2 at the November meeting.”
GREG FARANELLO, HEAD OF GLOBAL MARKETS TRADING AND TREASURY,
ESPIRITO SANTO INVESTMENT, NEW YORK
“The headline reading came in weaker-than-expected. A lot of the decline has to do with the layoffs of census workers. This still points to a fairly weak labor market.
“The bond market has already rallied a huge amount with the expectations of some kind of quantitative easing from the Fed. We still have plenty of time before the next Fed meeting. We have already priced in a fair amount of that quantitative easing. This report hasn’t changed things much.”
GREG SALVAGGIO, VICE PRESIDENT FOR TRADING, TEMPUS CONSULTING
WASHINGTON:
“It’s hard to make sense of this data as it is very mixed, with the government still shedding workers while the private sector is hiring. No wonder forex markets are all over the place.”
“Still, the Fed seems to be pretty much set in providing further stimulus to the economy and this data won’t detract them. Maybe the Fed won’t be as aggressive as some in the markets were pricing, but they will still do it.”
“There was no sign of the Bank of Japan in the market yet, but there’s strong support below the 82 yen level and I wouldn’t be surprised to see it bounce if it dips below 82 again today.”