Employment, Earnings and Potential Sanctions Drive Big Market Moves

There have been a number of positive developments this morning, but the market reaction to them in a macro and individual level has been very different.

North American job numbers for December showed job creation accelerating. Both US Nonfarm Payrolls (256K vs street 154K and previous 212K) and Canada employment (street 90K vs street 25K and previous 51K) beat analyst expectations handily. Meanwhile, wage inflation was subdued as US average hourly earnings (3.9% vs previous 4.0%) and Canada average hourly wages (3.7% vs previous 3.9%) slowed from last month.

This news was taken by the street as a sign of a robust North American economy, sending treasury yields surging and stocks sliding. The US 10-year treasury note yield has popped back up above 4.75%. Meanwhile, US index futures, which had been quiet ahead of the job numbers, have turned sharply downward in the last few minutes, and are currently down 0.75% to 1.25%.

European stocks are mixed today with the Dax up 0.25% and the FTSE down 0.6%. Gold and the Loonie are steady, but the US Dollar is surging against the Euro and Pound which are down 0.5%-0.7%. Bitcoin is up 2.3%.

While the broad market has been under pressure, two individual stocks have responded positively to earnings reports this morning. Walgreens Boots is up 14.4% while Delta Air Lines is up 7.5% after both companies beat the street today.

Reports that a new round of sanctions against Russia and Iran may be on the way has sparked a big rally in the oil market with US Crude up 4.1% and Brent Crude up 3.8%. Natural Gas is up 4.6% in tandem and on speculation of cold winter weather coming. Copper is up 0.2%.

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