The stock market took a big swing last Friday, January 10th, mostly unexpectedly after the United States released one of its most important reports regarding the labor market and its current state. The Non-farm Payrolls report (better known as NFP) is one of the numbers that is closely watched by the Federal Reserve today. The Fed is awaiting further employment and inflation data to decide where interest rates should be headed.
As it turns out, the NFP report blew out of the consensus by nearly 100,000 jobs, which sent the SPDR S&P 500 ETF Trust (NYSEARCA: SPY) selling off significantly. A hotter labor market would eliminate the need for the Federal Reserve to entertain further interest rate cuts. The only issue is that another significant report, the manufacturing and services PMI, shows a completely different story.
