FxPro Financial Services Ltd | Aug 10, 2020 05:20AM ET
The U.S. dollar had a chance to rebound after the relatively positive labor market data on Friday. The total growth of Nonfarm Payrolls exceeded expectations: 1763K new jobs compared to a forecast of 1500K.
There was also a noticeable increase in payrolls: 0.2% MoM vs the forecast of -0.5% MoM.
Overall, the difference between the expectations and the actual data has been a robust positive driver for the last few weeks. Company reports, according to FactSet, exceed expectations by more than 22%. This is the highest level in the history of observation since 2008.
Similarly, most macroeconomic indicators are appearing better than forecasts, forming a short-term positive momentum in the markets.
At the same time, traders should not be confused by the relative dynamics: the number of jobs in the U.S. now is 139.6 million, which is 12.9 million below the February high. Reporting data from S&P500 companies show a 34% drop in profits, while revenues fell by almost 10%. This is the worst data since 2009.
However, the soft monetary policy and the weakening of the dollar in recent months feeds the demand for stocks. Futures on the S&P500 rose to 3360 on Monday morning, the highest since February 21. It is now only one per cent below historical highs.
The FxPro Analyst Team
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