With the markets having anticipated NFPs all week, there was sure to be some disappointment. But the number was as affable as possible, and little was changed with the market having already priced in a hawkish Fed rhetoric. That's not to say the data was clearcut – the unemployment rate increased, average hourly wages were below expectations, and the labor force participation rate increased. The cooler numbers may have renewed some hope for a soft landing, but on the Friday before a long weekend, there is bound to be outsized reaction to headlines. We continue to watch for new direction from the range-bound S&P Futures (3900/4100), whose support level was upheld again today. 10-year yields also remain stuck, as they declined off the top end of their 2.5% - 3.5% range, and the dollar weakened, providing commodities with a bit of a boost. This wasn't enough to break larger macro trends though - Zinc had its worst week in nearly a decade, as Chinese lockdowns affected demand. Keep an eye on Gold – a break of the support level could have huge implications for currencies, and going through 1676/1670 would next target 1366. In terms of sectors Energy and Materials outperformed, the latter after a 20% spike in nitrogen fertilizer (UAN) this week. Despite all the commotion around conflicting data, investors are still pricing in a 56% chance of a 75bp hike (although this is down from 72% pre-NFP). Next week brings further realization that September is historically one of the worst performing months, as well as the Fed's last opportunity to speak ahead of their blackout period (Sep 10-22). Do rest up…
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