Robust jobs report could instill confidence

July 06 14:40 2015

Due to the Fourth of July market shutdown Friday, the monthly employment report dubbed “Jobs Friday” will be renamed “Jobs Thursday.” But the latest update on the health of the U.S. job market will still be a key market-moving piece of information. It will temporarily pry Wall Street’s attention away from the Greek debt drama, which will likely regain its top billing as the Sunday referendum vote — which could determine Greece’s fate in the eurozone — nears.US-jobs-sign-Washington-007

Wall Street expects another solid month of job gains, with the consensus now looking at 230,000 new jobs in June, down from 280,000 in May. The unemployment rate is expected to tick down to 5.4% from 5.5%. JJ Kinahan, chief market strategist at TD Ameritrade, argues that the June jobs report is more about sending the message that the U.S. economy is back on track than it is about how the number impacts the timing of the Federal Reserve’s first interest rate hike, perhaps in September.

A second month in a row of stellar job creation will help instill belief in the economy and take the focus off of Greece and worries over what a Fed rate hike might do to asset prices, he says. “It will help calm markets to see we are seeing lots of jobs created,” Kinahan says. “A blowout number above 270,000 would restore confidence and make people feel good about the second half of the year.”