Jobs report, inflation data to test US rate path and economic strength
SPY•Investors will watch the September jobs report, expected to show 100,000 jobs added and 4.2% unemployment, and Wednesday’s PCE inflation data for clues about the Federal Reserve’s rate path. Treasury yields have risen, while an equal-weight S&P 500 index was down about 4% in September.
1. Markets face bond risks
US stock indexes remained near record levels on Friday, with the S&P 500 less than 1% below its mid-August peak. The 30-year Treasury yield reached its highest level in more than 20 years, and the 10-year yield rose well above 5%. Eight of 11 S&P 500 sectors were negative for September, while the equal-weight index was down about 4%.
2. Jobs and inflation in focus
The September employment report, due October 2, is expected to show 100,000 jobs added and an unemployment rate of 4.2%. Wednesday’s personal consumption expenditures price index report will offer a reading on inflation; core PCE rose 3.3% in the 12 months through July, above the Fed’s 2% target. The Fed raised rates by a quarter percentage point on September 16 and signaled another increase before year-end.
