Coffee With Greta: Labor Market Nears Full Employment
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DJIA Futures: +122 (+0.4%)
SPX Futures: +14 (+0.3%)
NASDAQ Futures: +45 (+0.3%)
Good morning friends!
Futures are higher as the market kicks off a new quarter with fresh jobs data.
Let’s get right to it!
Job Growth Falls Short in March
The March jobs report shows the labor market is nearing full employment as the pool of available workers shrinks.
The Labor Department reported the U.S. economy added 431,000 workers last month.
That was a slowdown from the upwardly revised 750,000 in February and slightly lower than expectations for 490,000.
The leisure and hospitality sector added the most jobs last month with 112,000.
The unemployment rate fell more than expected, dropping to 3.6% from 3.8%.
The labor force participation rate rose 0.1% to 62.4%, that metric is still down 1 point from pre-pandemic levels.
Average hourly earnings rose 0.4% monthly as expected and 5.6% year-over-year.
Treasury Yield Curve Inverts
A key part of the Treasury yield curve remains inverted following that jobs data.
The yield on the 2-year Treasury is up to 2.436% and the 10-year yield is sitting at 2.422%.
Those yields inverted officially in late trading Thursday.
This inversion is seen as a warning sign for a recession in the next one to two years.
The 2-year/10-year spread has inverted before every recession since 1955.
The 5-year and 30-year Treasury yields also inverted this morning.
The yield on the 5-year Treasury note hit a high of 2.56% while the yield on the 30-year Treasury bond rose to just 2.53%.
GameStop Surges on Stock Split Announcement
GameStop (GME) shares are surging 14.7% ahead of the open after the video game retailer announced plans to split the stock.
The company announced it will seek shareholder approval to increase the number of outstanding shares to 1 billion from 300 million.
That split would be implemented in the form of a stock dividend.
GameStop said the split would “provide flexibility for future corporate needs.”
Oil Prices Remain Lower
Oil prices are lower as more nations are set to discuss reserve releases.
West Texas Intermediate crude futures are down 1.5% to just under $99 per barrel with Brent crude futures slipping 1% to under $104 per barrel.
The International Energy Agency member nations are set to meet today to discuss the release of more global reserves.
This comes after President Biden ordered the release of 1 million barrels of oil per day from the U.S. Strategic Petroleum Reserve for the next 6 months.
That’s the largest and longest SPR release in history and is an effort to reduce record-high gas prices in the U.S.
But experts say it won’t make much of a difference in oil supply as the U.S. consumes on average 20 million barrels per day.
Data from AAA shows the national average at $4.215 per gallon today.
In Case You Missed It
- PCE inflation pressures hit a 40-year high in February. The PCE Price Index surged 6.4% year-over-year, the strongest gain since January 1982. The Fed’s preferred inflation gauge, the Core PCE Index, jumped 5.4% annually. That’s the largest gain since April 1983. On a monthly basis, headline inflation rose 0.6% while incomes rose just 0.5%.
