Pre-Market Open: US Stocks Eye NFP Data, Bond Rout Piles Pressure
US stocks have struggled since the beginning of the year, Trump policies causing inflation concerns. Leading to bond rout leaving stock valuations less attractive.
- US bond rout placing pressure on stocks
- Forecasts for NFP data today expect expansion
- Attention turns to CPI data next week
Broker | Review | Regulators | Min Deposit | Website | |
---|---|---|---|---|---|
🥇 | ![]() | Read Review | FCA, CySEC, ASIC, MAS, FSA, EFSA, DFSA, CFTC | USD 100 | Visit Broker |
🥈 | ![]() | Read Review | FSCA, FSC, ASIC, CySEC, DFSA | USD 5 | Visit Broker |
🥉 | ![]() | Read Review | CySEC, MISA, FSCA | USD 25 | Visit Broker |
4 | ![]() | Read Review | ASIC, BaFin, CMA, CySEC, DFSA, FCA, SCB | USD 200 | Visit Broker |
5 | ![]() | Read Review | ASIC, FCA, CySEC, SCB | USD 100 | Visit Broker |
6 | ![]() | Read Review | FCA, FSCA, FSC, CMA | USD 200 | Visit Broker |
7 | ![]() | Read Review | BVI FSC | USD 1 | Visit Broker |
8 | ![]() | Read Review | CBCS, CySEC, FCA, FSA, FSC, FSCA, CMA | USD 10 | Visit Broker |
9 | ![]() | Read Review | ASIC, CySEC, FSCA, CMA | USD 100 | Visit Broker |
10 | ![]() | Read Review | IFSC, FSCA, ASIC, CySEC | USD 1 | Visit Broker |
The NAS100 is down 0.02% in pre-market trading and the DOW is down 0.01% in anticipation of today’s NFP data.
Bond Markets Predict Higher Inflation
The bond market has been in a sharp selloff since December 2024, peaking at a yield of 4.73% on January 8 and then settling at current levels around 4.70%.
Fixed income investors are concerned about Trump’s policies going into 2025. While the theory says tariffs may import inflation, it still remains to be seen how American entrepreneurs address saving their bottom line.
Also, tariffs on imports are not the sole agenda of the incoming administration. If DOGE works and bureaucracy is reduced I believe we are mor likely to see the economy expand faster than the past 4 years.
Economic expansion may offset slightly higher inflation, and a reduction in government spending may reduce the volume of treasury issuance. Both factors would lead to bonds being bid up and lower yields.
NAS100 Live Chart
All Eyes on NFP Data
The market today is focused on today’s NFP data where forecasts expect a number of around 160k new jobs. 150k is the number of jobs that most economists consider as indicating an expanding economy.
Usually that’s a positive thing, and the stock market reacts positively. In the current environment, it may mean the Fed sees a risk in higher prices as the economy continues to expand.
I do expect today’s NFP number to create considerable volatility as the markets figure out what the number is likely to lead to.
Attention Turns to Inflation Data Next Week
As the week comes to a close, the market is already turning its attention to CPI and inflation next Wednesday. The week has been particularly lackluster, with the NAS100 losing 0.75% and the DOW 0.25% so far.
Next week’s data for inflation will be closely watched as the Fed is beginning to talk of possible inflation risks. The FOMC minutes released on Wednesday showed that some members discussed the risk of inflation from a hike in import tariffs.
The forecasts are for December CPI are for a small increase from 315.49 to 315.60. While YoY inflation forecasts expect an increase of 0.2% to 2.9% in December.
These may not be large increases but I would imagine the numbers are enough to keep the Fed on hold for the next meeting.
Sidebar rates
Related Posts
