Stock Futures Down Ahead of Key Employment Report
Keep a close eye out on today’s ADP non-farm employment report due out at 1:15pm GMT. The high impact report is expected to show 131k new jobs created for the month, and any surprises will surely create short term opportunities for trading USD against the major cross pairs.
The report is released in advance of the government’s non-farm payroll report this Friday, which is typically the most active trading day of the month. At the moment stock futures are falling in reaction to S&P downgrade of 14 big banks in the US and Europe, so stay tuned and contact your account manager today for relevant trade strategies!
Trade Alert for ADP Non-Farm Employment Change
The ADP National Employment Report is develped by ADP and is the measure of employment derived from an anonymous subset of roughly 500,000 U.S. business clients.
During the twelve month period through June 2010, this ADP subset averaged over 340,000 U.S. business clients and over 21 million U.S. employees working in all private industrial sectors. The ADP Small Business Report® is a monthly estimate of private nonfarm employment among companies in the United States with 1-49 employees and is a subset of the ADP National Employment Report.
The data for both reports is collected for pay periods that can be interpolated to include the week of the 12th of each month, and processed with statistical methodologies similar to those used by the U.S. Bureau of Labor Statistics to compute employment from its monthly survey of establishments. Due to this processing, this subset is modified to make it indicative of national employment levels; therefore, the resulting employment changes computed for the ADP National Employment Report are not representative of changes in ADP’s total base of U.S. business clients.
Why is it important?
Job creation is an important leading indicator of consumer spending, which accounts for a majority of overall economic activity. It also leads the government report on employment by 2 days and is a widely followed comparison indicator.