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JOBS DAY — What you need to know in markets on Friday

Myles Udland
Markets Reporter

Friday is the main event: it is jobs day in America.

In the morning, the BLS will release its latest employment report at 8:30 a.m. ET.

According to Bloomberg, here is what Wall Street economists are looking for:

  • Nonfarm payrolls: +180,000
  • Unemployment rate: 4.7%
  • Average hourly earnings, month-on-month: +0.2%
  • Average hourly earnings, year-on-year: +2.7%
  • Average weekly hours worked: 34.4

Ahead of Friday’s report, markets were fairly quiet with geopolitical headlines getting most of the focus from investors, who were still breaking down the impacts of Wednesday’s news that the Federal Reserve is considering winding down its balance sheet later this year and that some Fed officials have taken note of the high price of stocks.

This report does, however, come after Wednesday’s blockbuster private payrolls report from data provider ADP, which while not necessarily a great gauge of how the government’s number will come in does give us a sense that hiring remains quite strong in the early days of the Trump era.

Jobs preview

Each month, the jobs report is the highlight of the economic calendar.

But Friday’s jobs report is perhaps as unanticipated as it gets, given that the Federal Reserve’s future path of interest rate hikes is unlikely to be impacted in any major way and headlines away from markets and the economy have been dominating investors’ attention in recent days.

In a note to clients ahead of the report, economists at Goldman Sachs said they expect nonfarm payrolls to grow by 170,000, slightly less than consensus and down from last month’s 235,000 print.

“Labor market fundamentals remain encouraging, as March exhibited further improvement in manufacturing employment surveys, a new cycle high for the Conference Board labor market differential, and continued low readings of initial jobless claims,” Goldman writes.

“However, we believe the sharp drop in temperatures and the early-month winter storms will depress payroll growth in weather-sensitive categories.”

Goldman adds that the winter storm which dumped in excess of a foot of snow on parts of the midwest and northeast in mid-March occurred during the payroll survey week, which could impact the report.

Economists at Wells Fargo, however, don’t see the same impacts from the weather coming through in Friday’s report and are forecasting nonfarm payrolls grew by 191,000, better than consensus but still below last month.

“No doubt, the pace of nonfarm hiring started the year on a strong note, averaging 237,000 per month,” the firm writes. “We do not believe this is the start of a new higher trend, and expect employment growth to slow in March. That said, the U.S. labor market continues to make gains and supports further Fed policy normalization plans in the remainder of the year.”

Myles Udland is a writer at Yahoo Finance. Follow him on Twitter @MylesUdland

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