Stocks Bounce Back as Traders Await Fed Speakers and Nonfarm Payrolls

US index futures are up 0.2%-0.4% this morning, regaining their footing and bouncing back from the weakness seen earlier in the week. A decline in the Prices Paid inflation component of yesterday’s US ISM Services PMI report helped to ease fears of rising inflation for now.

The US 10-year treasury note yield is holding steady above 4.35% indicating that concern interest rate cuts may have to be delayed (Fed Chair Powell did not seem to be in any hurry yesterday) has not gone away. Today six more Fed officials are out speaking and the Canada Federal Budget speech is after the close today.

This morning Canada reported a better-than-expected trade surplus ($1.4B vs street $0.8B), a positive sign for the economy. US weekly initial jobless claims were slightly worse than expected (221K vs street 214K). Service PMI reports out of Europe generally came in better than expected.

Tomorrow brings wage inflation numbers including US Average Hourly Earnings (street 4.3%) and Canada Average Hourly Wages (previous 4.9%), in addition to the headline US Nonfarm Payrolls (street 200K) and Canada employment change (street 25K).  

Commodity and currency trading is mixed today. The US Dollar has backed off a bit, enabling Bitcoin to bounce 1.0% and the Loonie plus the Euro to rise 0.2%, but Gold is down 0.5%. US Crude Oil is down 0.3% while Copper is up 0.9%.

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