- Jeffrey Kleintop, chief market strategist at LPL Financial
This week's main highlight is the statistics from the U.S. labour market. A couple of months ago, ADP report, unemployment rate and NFP all had a significant impact on market's movement, however, now it seems to be subdued.
Economist are already bracing for weak data, as the cold weather continues to inflict pain on the world's largest economy. Therefore, even in case of a disappointment, markets will not react significantly. Most likely harsh weather during the survey's reference week will muddy the reading. The most severe weather conditions were registered in the Southeast, were many companies were forced to shut operations. Payrolls are projected to increase by 150,000 in February, after a 113,00 gain a month earlier. Projections, however, are ranged from 105,000 to 235,000, hence, only a figure below or above these levels can have a significant impact on financial markets. While unemployment rate is forecasted to remain unchanged at 6.6%- the lowest since October 2008, the participation rate or the level of employment are still far away from their pre-crisis peaks.
A third straight month of disappointing payrolls, in theory, should raise speculations the Fed will pause the tapering of its stimulus programme; however, the central bank will most probably blame the weather and only.
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