February 5, 2021 Headlines

 Financial markets are digesting another soft jobs report this morning. Nonfarm payrolls added just 49,000 jobs in January (+105k expected), and the prior two months were revised lower by 159,000 jobs. The unemployment rate unexpectedly fell 40 basis points to 6.3%, but most of the decline was attributable to a 406,000 decline in the official labor force, pushing the participation rate down to 61.4%. Treasuries have recovered some of the early-morning steepening prior to release of this report, but long-end yields are still higher on the day. In the end, this was not a major surprise given the Covid-related lockdowns in several major population centers in the U.S., and recent improvements in hospitalization growth rates across much of the country is leading to loosening of some of those restrictions. Additionally, this report may give Democrats more political ammo for the larger relief package they are targeting.

Jason Haley
Chief Investment Officer

02/01/21Markit US Manufacturing PMI59.159.259.1
02/01/21Construction Spending MoM0.90%1.00%0.90%1.10%
02/01/21ISM Manufacturing6058.760.760.5
02/01/21ISM Prices Paid7682.177.6
02/01/21ISM New Orders61.167.967.5
02/01/21ISM Employment52.651.551.7
02/02/21Wards Total Vehicle Sales16.15m16.63m16.27m
02/03/21MBA Mortgage Applications8.10%-4.10%
02/03/21ADP Employment Change70k174k-123k-78k
02/03/21Markit US Composite PMI58.758
02/03/21Markit US Services PMI57.458.357.5
02/03/21ISM Services Index56.758.757.257.7
02/04/21Challenger Job Cuts YoY17.40%134.50%
02/04/21Nonfarm Productivity-3.00%-4.80%4.60%5.10%
02/04/21Unit Labor Costs4.00%6.80%-6.60%-7.00%
02/04/21Initial Jobless Claims830k779k847k812k
02/04/21Continuing Claims4700k4592k4771k4785k
02/04/21Bloomberg Consumer Comfort44.645.7
02/04/21Factory Orders0.70%1.10%1.00%1.30%
02/04/21Factory Orders Ex Trans1.40%0.80%1.10%
02/04/21Durable Goods Orders0.20%0.50%0.20%
02/04/21Durables Ex Transportation0.70%1.10%0.70%
02/04/21Cap Goods Orders Nondef Ex Air0.60%0.70%0.60%
02/04/21Cap Goods Ship Nondef Ex Air0.70%0.50%
02/05/21Revisions: Establishment Survey
02/05/21Change in Nonfarm Payrolls105k49k-140k-227k
02/05/21Two-Month Payroll Net Revision-159k
02/05/21Change in Private Payrolls163k6k-95k-204k
02/05/21Change in Manufact. Payrolls30k-10k38k31k
02/05/21Unemployment Rate6.70%6.30%6.70%
02/05/21Average Hourly Earnings MoM0.30%0.20%0.80%1.00%
02/05/21Average Hourly Earnings YoY5.00%5.40%5.10%5.40%
02/05/21Average Weekly Hours All Employees34.73534.7
02/05/21Labor Force Participation Rate61.50%61.40%61.50%
02/05/21Underemployment Rate11.10%11.70%
02/05/21Trade Balance-$65.7b-$66.6b-$68.1b-$69.0b
02/05/21Consumer Credit$12.000b$15.274b

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