Economy Looking Up Ahead of Big Jobs Number
Some mildly positive economic data boosted hope for U.S. growth heading into the release of a Nov. 2 employment report that could influence the presidential election. The news drove stocks to rise on Nov. 1.
The median estimate of economists surveyed by Bloomberg was for a 125,000 increase in nonfarm payrolls in October (up from 114,000 in September) and a 7.9 percent unemployment rate (up from 7.8 percent in September). “This is essentially a trend-like number,” Joseph LaVorgna, chief U.S. economist of Deutsche Bank Securities, said in a note to clients.
“Overall, the report will portray a labor market that remains weak,” Stephen Oliner, an economist at the American Enterprise Institute who is a former Federal Reserve senior adviser, said in an AEI statement. He was in line with the consensus on payroll growth at 125,000, but one tick higher on his prediction for the jobless rate, at 8 percent.
Automatic Data Processing, the HR management company, said that by its calculation private payrolls rose by 158,000 in October. If it’s right, the jobs report on Nov. 2 could surprise on the upside. The corresponding Bloomberg economists’ median estimate for private payrolls (i.e., excluding government workers) was an increase of only 123,000.
In other news, the Conference Board said its consumer confidence increased 3.8 points to 72.2 in October, which was a more than four-year high, although still low by historical standards.
The Institute for Supply Management’s manufacturing index edged higher, to 51.7 in October from 51.5 in September—not a lot, but better than the decline that economists had predicted.
Not all the economic news was good. The National Association of Credit Management said its credit managers’ index fell to 55.3 from 54.4, possibly influenced by fears that the 2013 “fiscal cliff” of possible spending cuts and tax hikes will hurt sales.