U.S. Job Market: The Truth unveils today 07/02/2025

HOT stories for today

US market wrap:
 

• Bulls and bears wrestled for control, with buyers managing to recover some ground after a sluggish start to the session. The earnings landscape remains uneven, as several stocks swung by double-digit percentages. Meanwhile, investors are closely watching today’s nonfarm payrolls report to gauge how the labor market’s slowdown could influence the Federal Reserve’s rate trajectory.
• Equities managed to secure modest gains as traders dissected a mix of earnings reports ahead of the key jobs data. Meanwhile, bonds trimmed earlier losses after Treasury Secretary Scott Bessent reaffirmed his stance on a softer trajectory for 10-year yields under the Trump administration. Amazon.com Inc. plunged in after-hours trading after issuing a profit forecast that fell short of expectations, signaling that the company is continuing to ramp up spending to expand its artificial intelligence services. 

U.S. Job Market: The Truth Unveils Today
 

• Wall Street is bracing for Friday’s January jobs report, which could reveal whether the U.S. labor market was weaker than it appeared in late 2024. Last fall, the government admitted it had overestimated job gains from April 2023 to March 2024 by 818,000. The upcoming revisions may not be as extreme but could still reshape the labor market narrative. The key question now: Were hiring numbers from April to December also overstated?
• If job growth during that period drops from the previously estimated 159,000 per month to 125,000 or less, it could revive speculation about Fed rate cuts. However, most economists expect only modest downward revisions. “It shouldn’t change the big picture too much,” said Bill Adams, chief economist at Comerica, citing strong payrolls and low layoffs in late 2024. For January, Wall Street predicts 169,000 new jobs, but economists warn against taking the number at face value due to winter storms and wildfires skewing the data.

 
Stocks on the move:       

• Amazon (AMZN): The e-commerce giant declined 2% after issuing weaker-than-expected guidance for the current quarter. Amazon projects first-quarter revenue between $151 billion and $155.5 billion, falling short of the $158.5 billion estimate from analysts surveyed by LSEG. However, the company’s fourth-quarter earnings and revenue surpassed expectations.
• Take-Two Interactive Software (TTWO): The video game developer climbed nearly 7% despite reporting fiscal third-quarter revenue of $1.37 billion, slightly below the $1.39 billion forecast by LSEG analysts.
• Affirm Holdings (AFRM): Shares of the payment solutions company jumped more than 9% after exceeding revenue expectations for the fiscal second quarter. Affirm reported $866 million in revenue, surpassing analysts’ projections of $807 million, according to LSEG. Gross merchandise volume expanded 35% year-over-year in the prior quarter.
• Pinterest (PINS): The social media platform saw its stock surge 18% as fourth-quarter revenue came in at $1.15 billion, edging past Wall Street’s estimate of $1.14 billion, per LSEG.
• Expedia (EXPE): The travel services provider gained 11% after delivering stronger-than-anticipated fourth-quarter results. Expedia posted adjusted earnings of $2.39 per share on revenue of $3.18 billion, exceeding analysts’ expectations.

 
Today’s action

• Asia-Pacific markets showed a mixed performance on Friday as investors digested India’s interest rate cut and Japan’s household spending data. Japan’s Nikkei 225 declined 0.57%, while the Topix slipped 0.42%. However, Japan’s household spending in December surged 2.7% year over year, significantly surpassing Reuters’ forecast of a 0.2% increase. South Korea’s Kospi dropped 0.68%, whereas the small-cap Kosdaq edged up 0.32%. Hong Kong’s Hang Seng Index advanced 0.69%, and mainland China’s CSI 300 gained 0.96%. The Reserve Bank of India cut its key interest rate for the first time in nearly five years, citing cooling inflation as an opportunity to support the slowing economy. India’s benchmark indexes, the Nifty 50 and Sensex, hovered near the flatline, while the Indian rupee, which recently hit a record low, slightly strengthened to 87.4 against the U.S. dollar.
• Meanwhile, U.S. stock futures were little changed ahead of January’s key jobs report. Dow Jones Industrial Average futures dipped 34 points, or 0.08%, while S&P 500 and Nasdaq 100 futures remained near the flatline. Investors now turn their attention to the jobs report, set for release at 8:30 a.m. ET.

Wahtclist: AMZN, EXPE, AFRM, TTWO, BILL. FTNT, ELF, QCOM

Bitcoin

• Bitcoin continued its downward trend this week, briefly falling below $95,600 during trading. With a demand zone between $94,300 and $95,800, the cryptocurrency has seen a liquidity sweep around $96,200, but a definitive bullish reversal has yet to materialize in the short term. Despite the recent consolidation, some analysts remain optimistic about Bitcoin’s trajectory. Crypto analyst Mikybull suggests that if BTC follows its seasonal pattern observed between 2018 and 2014, it could reach a new all-time high of $120,000. Market researcher Danny Marques also believes that the recent drop to $91,000 marked a local bottom, adding that Bitcoin could surpass $120,000 sooner than expected and at a much faster pace.
• However, not all analysts agree on an imminent rally. The data analysis platform Alphractal warns that leverage trading remains one of Bitcoin’s biggest risks, potentially leading to a retest of $80,000 before any significant upward movement. While some expect Bitcoin to reach $110,000 in the near term, others caution that further corrections may come first.
  Watchlist: Bitcoin: 89 000-108 000, Ethereum: 2200-3000, Solana: 180-276

Forex

• The Japanese yen pulled back after reaching a two-month high against the U.S. dollar on Friday, though the narrowing interest rate gap between the U.S. and Japan could help limit further losses. Despite cautious remarks from the International Monetary Fund (IMF), expectations that the Bank of Japan (BoJ) will continue tightening its monetary policy provided some support for the yen. The subdued movement in the U.S. dollar may also cap gains in USD/JPY as investors await the release of the U.S. Nonfarm Payrolls (NFP) report.
• Meanwhile, the euro edged lower, with EUR/USD slipping to around 1.0375 during Friday’s Asian session. Renewed concerns over U.S. trade policy, particularly tariff threats from Donald Trump, weighed on the shared currency, while broader risk-off sentiment added further pressure. Traders are closely watching Germany’s industrial production data for fresh cues, with U.S. employment figures later in the day expected to be the key market driver.
  Watchlist: EUR/USD: 1.0200-1.0550, USD/JPY: 153.6-158.80

Basic Materials

• West Texas Intermediate (WTI) crude remains under pressure, heading for a third consecutive weekly decline despite stabilizing around $70.80 per barrel in early European trading on Friday. Oil prices retreated following a surge in U.S. crude and gasoline inventories, pointing to sluggish demand. Adding to the downward momentum, former U.S. President Donald Trump reaffirmed his intention to ramp up domestic oil production, further weighing on market sentiment amid concerns over an already ample supply.
• Meanwhile, Saudi Aramco raised its official selling prices, driven by increasing demand from China and India, coupled with ongoing disruptions in Russian exports. Gold, on the other hand, struggled to hold onto its intraday gains ahead of the European session but remained near record highs set earlier in the week. A slight uptick in the U.S. dollar, as traders repositioned ahead of the critical Nonfarm Payrolls (NFP) report, limited upside momentum for the precious metal. However, expectations of Federal Reserve rate cuts and subdued U.S. bond yields continued to provide support, while lingering trade war concerns helped cap losses.
  Watchlist: GOLD 2600-2822, US Oil: 70.00-79.00

Key Economic Events Today:

EST time
08:30 am: CAD Unemployment Rate
08:30 am: USD Unemployment Rate
08:30 am: USD Non-Farm Employment Change
09:25 am: USD FOMC Member Bowman Speaks
10:00 am: USD Consumer Sentiment, Infaltion Exp.
12:00 pm: USD FOMC Member Kugler Speaks

Earnings

BMO (Before the US Market opens)
FTV           Fortive Corporation
KIM           Kimco Realty Corp 
AVTR        Avantor Inc.
ROAD       Construction Partners Inc.
FLO          Flowers Foods Inc.

AMC (After the US Market closes): Enjoy your weekend!

The TEFS Analyst team wishes you a successful day!