Market commentary

The final event in one of the week was the employment report, and it was a surprise. Nonfarm payrolls increased 151,000 in October and September’s figure was revised 54,000 better. In the private sector, 159k jobs were created and the September release was revised 43,000 higher. Average weekly hours increased from 34.2 to 34.3 and hourly earnings were up 0.2% month-over-month. The other piece of the report, household survey, tells a different story. The unemployment rate remained at 9.6% and the underemployment rate dropped slightly from 17.1% to 17.0%. The bond market immediately gave back most of Thursday’s gains on this stronger than expected data, however stocks are flat.

In reference to Wednesday’s Fed action, there is a growing chorus of frustration coming from other countries regarding the Fed’s monetary policies. According to the Financial Times, China, Brazil, and Germany all criticized the Fed action with Brazil’s finance minister commenting, “Everybody wants the U.S. economy to recover, but it does no good at all to just throw dollars from a helicopter.” The Brazilian Finance Minister continued saying, “You have to combine [monetary policy] with fiscal policy. Hmmm, what does this guy from Brazil know that our US politicians don’t know? Is it that increased government regulations and borrowing to support state and local governments does not actually create jobs?

Mortgage pricing is .20% to .30% worse from Thursday afternoon.