Germany's DAX index commenced November trading on an optimistic note, elevating by 0.92% at the close on the first day of the month, buoyed by fresh labor market statistics stemming from the world's largest economy. While the day remained relatively quiet for economic news in Germany and the broader eurozone, other significant markets drew attention on Friday. In the United States, data released by the Bureau of Labor Statistics indicated that the unemployment rate remained steady month-over-month at 4.1% in October.
The total number of unemployed individuals stood at 7 million during the reporting period, showing little variation from September's figures. Furthermore, the total nonfarm payroll employment saw an increase of 12,000 in October, as noted by the bureau. This new data serves as a precursor to the upcoming monetary policy meeting of the US Federal Reserve next week, where analysts widely predict a reduction in the interest rate by 25 basis points from the current 5%. "For the Fed, this data is more relief than alarm.
The robustness of GDP, along with personal income and spending in recent months, alongside the preliminary figures on September payrolls, had prompted the market to predict a heightened likelihood of a pause in one of the next two meetings. Yet, this should provide the Fed with ample leeway to adhere to the trajectory they outlined in the last SEP," stated Jefferies.
"Our perspective that the Fed will proceed with a 25 bps cut in November and December, then transition to an every-other-meeting pace in 2025 remains solidly in place." However, prior to the interest rate decision, voters in the United States face a critical choice on November 5 for the presidential elections. Within the eurozone, the upcoming week is laden with data updates regarding the October PMI, both for the euro area and Germany, the continent's largest economy. On the corporate front, German life science conglomerate Sartorius (SRT.F) spearheaded the rally among German blue-chip firms, concluding the day with a 2.90% increase..