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US ADP Jobs report disappoints, Gold jumps, as dollar weakens

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The ADP national employment change released today reported 390,000 new hires vs the forecasted 695,000. It’s a measure of the change in the non-farm employment in the private sector. This report is a crucial indicator of the upcoming NFP data due later this week.

Stock futures were down slightly following the news release, with the Dow Jones losing 0.3%,  S&P 500 0.3% and Nasdaq futures losing 0.1%. Adding to this are concerns over the Delta variant, which will impact travelling and hospitality services.

The Gold price broke out of its daily consolidation reaching the $1830 price level. The US dollar was already weaker, and the jobs report crippled it further, causing gold to gain.  In addition, the Euro gained some footing against the US dollar.

The US dollar already weakened last week after the Fed failed to provide a timeline for its tapering plans. 

Central Bank’s tapering plans 

Treasury yields are also down by 1.18%; Federal Reserve Governor Christopher Waller said that the Central Bank might reduce bond purchases from October. The US Fed’s announcement in July was based on a more robust jobs report for August and September and was targeting an 800,000 growth in jobs. NFP added 850,000 jobs in July, and the forecast for August is 788,000. However, the disappointing ADP hiring numbers could be a taste of what’s to come on Friday.

The private sector hires have been increasing, fueled by the vaccination rollouts and consumers spending habits. The services sector notably picked up, adding 139,000 jobs to the hospitality and leisure sectors.  

The overall expectation is that the labour market will pick up in the months to come. The current jobs scarcity could be due to the generous unemployment benefits, childcare, and the prevailing fear of  Covid-19.

However, the latest ADP employment report is definitely a pre-curser of traders’ expectations and sentiment of the upcoming US NFP report this Friday. Moreover, the NFP affected news affairs will be updated on MetaNews.

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Justin N. Richards

Justin N. Richards is a Florida-based technical analyst, market researcher, educator, and trader. Justin began his career in Chicago in 2001 performing futures market analysis for floor traders at the Chicago Board of Trade and the Chicago Mercantile Exchange. He also worked for numerous brokerage firms during that time, all of which hold him in high regard, and he has been providing outstanding analysis services for traders worldwide ever since. Mr. Richards is an expert in the area of market patterns, price and time analysis as it applies to futures, Forex, and stocks. In addition to these talents, he provides educational services for investors looking to improve their analysis and trade skills. Justin has a B.A. in Business Administration from UCLA and an M.S. in Financial Markets and Trading from the Illinois Institute of Technology. Justin’s professional experience, education, and discipline, not only make him an exceptional analyst, they point him out as a reliable, hard working and intelligent business strategist who is dedicated to his craft.
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