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Chief Economist Scott Brown discusses the latest market data.

Nonfarm payrolls rose by 235,000 in the initial estimate for August, lower than expected, but that followed more than two million jobs added in the two previous months. Softer job growth likely reflects an impact from the delta variant, but there’s a fair amount of noise in the payroll estimate (reflecting statistical uncertainty, seasonal adjustment difficulties, etc.). Payroll gains in June and July were boosted by the seasonal adjustment in education. Ex-education, payrolls have averaged a 534,000 gain over the last three months – still very strong. The unemployment rate fell to 5.2%, while the employment-population ratio edged up to 58.5%, up from 56.5% a year ago, but still well below the pre-pandemic level (61.1%). Average hourly earnings jumped 0.6% (+4.3% y/y), but these figures are distorted by compositional changes.

The rest of the week’s economic reports were generally soft. The ISM Manufacturing Index was little changed, while the Service Index – both reports showed ongoing supply chain issues. The Conference Board’s Consumer Confidence Index fell sharply. Unit motor vehicle sales tumbled 10.7%, to a 13.1 million seasonally adjusted annual rate (vs. 14.5 million in July and 15.2 million a year ago).

Next week: The economic calendar is thin. Anecdotal information, such as the Fed’s Beige Book, plays a role in Fed policy decisions (watch for an impact from the delta variant). The European Central Bank may announce tapering. The Producer Price Index should continue to reflect supply chain pressures on inflation.

Indices

Consumer Money Rates

Currencies

Commodities

Bond Rates

Treasury Yield Curve – 09/03/2021

As of close of business 09/02/2021

S&P Sector Performance (YTD) – 09/03/2021

Economic Calendar

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Commodities trading is generally considered speculative because of the significant potential for investment loss. Markets for commodities are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising. Specific sector investing can be subject to different and greater risks than more diversified investments. Gross Domestic Product (GDP) is the annual total market value of all final goods and services produced domestically by the U.S. The federal funds rate (“Fed Funds”) is the interest rate at which banks and credit unions lend reserve balances to other depository institutions overnight. The prime rate is the underlying index for most credit cards, home equity loans and lines of credit, auto loans, and personal loans. Material prepared by Raymond James for use by financial advisors. Data source: Bloomberg, as of close of business September 2, 2021.