Today started with 261k ESU and 900 SPU traded on Globex, trading range was 1696.00 – 1703.50. Thursday’s regular trading hours (RTH’s), pit session trading range was 1703.30 – 1694.70 before settling at 1700.20 up 19.70 handles. NFP disappoints checking in at 162k versus expectations of 184k. June NFP was revised from +195k to +188k and May was revised from +195k to +176k – 26k less than previously reported. The average hourly earnings checked in at -0.1 vs exp of +0.2 and prior +0.4 and personal income checked in at 0.3 vs exp of 0.4 and prior 0.5. Most job gains in July were lower end retail and construction jobs were soft, but the jobless rate falls to four-year low. Ho, ha hum…goes the markets.
Today’s pit hours gapped 2 handles lower to 1698.30 – 1698.00. Global equities were mostly unchanged and turned lower after the disappointing U.S. jobs data and the 9:00 release of the factory orders did not help much either – checking in at 1.5% vs exp of 2.3%, last month was revised from 2.1% to 3.0%. It was a very quiet jobs day morning as many traders left early – extending their weekend. Weekend risk was still evident even after the U.S. announced it was closing a number of embassies and the STATE DEPT ISSUES WORLDWIDE TRAVEL ALERT FOR U.S. CITIZENS. However, there was not much in the way of price action as the SPU traded in a very tight 4.3 handle range until 11:15 and by 12:00 extending to a new high of 1702.10 following: FED’S BULLARD URGES WAIT FOR 2ND-HALF REBOUND BEFORE TAPERING. *BULLARD SAYS QE TAPERING COULD RISK PUSHING INFLATION LOWER. Also, crude enjoyed another choppy session with a two dollar trading range and was trading near the lows at midday following the U.S. travel alert.
After trading in a tight 6 handle range during the morning session, Goldman’s Kostin on the S&P500: “We forecast a 4% rise through year-end” and the bulls squeeze in another new high intraday high at 1702.50. At 2:30 the SPU was retesting the 1702.50 and shortly after chatter of an early look of $257M to buy on imbalance. The SPU continued the slow grind higher going into the closing imbalance and getting better as well…probably $800M to $900M with very little sell side present. 1705.00 traded going into the cash close before settling at another new record of 1704.00, up 3.8 handles on the day.