Why Investors Are Anxious About This Week's Job Report

×
Unemployment Benefits
Mike Groll/APJob seekers at a recent job fair in Hudson, N.Y.
By Alex Rosenberg | @CNBCAlex

Don't let the short week fool you. There's big news ahead for the American economy.

With Independence Day falling on July Fourth this year, which happens to be a Friday, the June employment report will be released one day earlier than normal. And market participants (at least the ones who haven't already headed to the Hamptons) will be watching with great interest, because a supremely weak revised first quarter GDP number leaves open some tricky questions about the state of the U.S. economy.

"This is a huge deal this week in light of the fact that we got such awful GDP numbers last week," said trader Jim Iuorio of TJM Institutional Services. "People have got to get some clarity from these numbers."

On Wednesday, the third estimate for GDP growth in the first quarter was revised down to a 2.9 percent decline, significantly worse than the prior estimate of a 1 percent decline. And while the weather and other somewhat random factors have been shouldered with the blame, the print is still seen as raising the stakes on Thursday.

"Even though the Q1 GDP figure is old news, the financial markets will need to see continued strength in the current quarter to become confident that last quarter's results were truly an aberration," wrote Deutsche Bank (DB) chief U.S. economist Joseph LaVorgna in a recent note. "In this regard, the June employment report ... takes on added significance."

To be sure, LaVorgna is indeed expecting the payrolls report to confirm that Q1 GDP ought to be more or less ignored. He predicts a 225,000 increase in non-farm payrolls, which is above the consensus.

"The Street is looking for stability here," said Michael Block, the chief strategist at Rhino Trading Partners, a New York-based broker-dealer and research provider. "The Street consensus looks very similar to what we saw in May. Expectations are very grounded. No one's really looking for anything to rock the boat here."

If the numbers miss on the downside, however, the ramifications could be serious, warns Chicago-based trader Jeff Kilburg.

"I think you need to be careful this week," he said. "This unnatural calm cannot last forever."


Increase your money and finance knowledge from home

Portfolio Basics

What are stocks? Learn how to start investing.

View Course »

What is Inflation?

Why do prices go up?

View Course »

Add a Comment

*0 / 3000 Character Maximum

31 Comments

Filter by:
pj512

I still haven't found a job, after three years, so I certainly won't help your numbers.

June 30 2014 at 8:37 PM Report abuse rate up rate down Reply
1 reply to pj512's comment
Jay McKay

Try six years

July 01 2014 at 5:10 AM Report abuse rate up rate down Reply
Richard

Dismal picture here and that's why a substantial number of US citizens are looking at leaving this country and many of the wealthy already have. We have found ourselves in much the same pickle that some eastern and a lot of western Europeans did during the turn of the 20th century.

June 30 2014 at 5:07 PM Report abuse +1 rate up rate down Reply
toosmart4u

d.barack,,,sounds like you are still talking about the bush jr. administration, you hit the nail right on the head.

June 30 2014 at 2:55 PM Report abuse -2 rate up rate down Reply
2 replies to toosmart4u's comment
democrap2

No dunce, he's talking about the current AWOL Administraion.

June 30 2014 at 3:02 PM Report abuse +3 rate up rate down Reply
trewliberal

toodumb2bfree it looks like you are still too dumb to be free.

Whoda thunk, right?

June 30 2014 at 4:40 PM Report abuse +1 rate up rate down Reply
wwas3434

FROM WHERE I SIT I DO NOT SEE ANY IMPROVEMENT IN THE ECONOMY FORECLOSURES ARE STILL PREVELENT IN THE HOUSEING MARKET

June 30 2014 at 2:54 PM Report abuse +4 rate up rate down Reply
Iselin007

Some employers or their representatives just say no were not hiring right now but you can fill out the form on the computer in the lobby. After so many people fill out that form it just may get lost along the way.

June 30 2014 at 2:00 PM Report abuse rate up rate down Reply
1 reply to Iselin007's comment
trewliberal

So?

June 30 2014 at 2:47 PM Report abuse -1 rate up rate down Reply
Iselin007

d.barack
And your point is ?


Point is seekers are going to be counted vigoriously and accurately when an employer is apple picking a hand full or less out of 100's or thousands. Basically the employer isn't going spend anytime or money to count everyone.

June 30 2014 at 1:56 PM Report abuse rate up rate down Reply
Iselin007

Remember today job cuts are mostly permanent and most hiring is part time, temporary and seasonal. Too many people are older an competing for the same crap jobs with younger people.

People have to pick up after their dogs or other pets but they don't make a scooper for this crappy jobs market!

June 30 2014 at 1:18 PM Report abuse +4 rate up rate down Reply
Iselin007

OPEN YOUR EYES:

If you want a jump start on the jobs data you have to vist the various state sites that posts the Warn Notices that warn employees of their job losses so many days in advance.

You don't have to wait for the jobs report then find out thousands of people lost their jobs right after the friggin report! Go ahead check the NJ Warn Notices to your hearts content.

June 30 2014 at 1:09 PM Report abuse rate up rate down Reply
1 reply to Iselin007's comment
trewliberal

Anybody who loses their job right after a monthly BLS Employment Survey report will simply show up in the following months numbers.

June 30 2014 at 2:43 PM Report abuse rate up rate down Reply
omerrica.inda.crapper

JAN~20~09~~>"THE DISGRACING OF AMERICA"". !!!!

June 30 2014 at 12:38 PM Report abuse +4 rate up rate down Reply
billcdaly

Are the millions of recent graduates both college and high school ( who don't intend on going to college but want to work) counted in the unemployment #'s? Or must they lose a job first to be called unemployed and counted by the government?

June 30 2014 at 12:23 PM Report abuse +4 rate up rate down Reply
1 reply to billcdaly's comment
Iselin007

Nobody is going out of their way to make sure all job seekers are counted, for instant programs scan people out and digitaly delete them. Employers don't have a priority to count anyone that isn't actively working for them. They just don't.

June 30 2014 at 1:42 PM Report abuse rate up rate down Reply
1 reply to Iselin007's comment
trewliberal

The unemployed reflect a BLS survey of citizens, not data provided by employers.

June 30 2014 at 2:46 PM Report abuse +1 rate up rate down