Hard for markets to digest the strong US NFP – Rabobank

By FXStreet FXStreet (Delhi) – Michael Every, Research Analyst at Rabobank, notes that the market did not so much digest the October US payrolls report on Monday as indigest it.

Key Quotes

“Equities were down across the board except in Japan (Nikkei +2.0% as JPY slumped) and China (Shanghai +1.6% as the market goes back on horse tranquilizers). Commodities tried to rally but also fell back as they logically should, with oil ending at USD47.2. Meanwhile, 10-year Treasury yields nudged higher to 2.34%.”

“On the equity front, one has to wonder if this is just a foretaste of things to come. After all, unless we get a wild card November payrolls slump, or a re-emergence of an EM crisis, for example, then the Fed appears locked in to a December rate hike. In that case, the only course of action that equities have shown can prevent them from dreaded tighter monetary policy, with all the need to be more sensible that this entails, is to act like a toddler in the ‘terrible twos’ and throw a temper tantrum until the Fed duly steps in to calm them down again by staying on hold for longer (as in 2013, October 2014, and October this year). We …read more

Source:: FX Street