The Tell: What happens when jobs report is released on Good Friday
NEW YORK (MarketWatch)—With the exception of those trading index futures, U.S. stock investors will have to remain patient through a long weekend before making any moves in reaction to the March nonfarm payrolls report.
That’s because U.S. exchanges will be closed on April 3 in observance of Good Friday, the day when the government releases its official employment report for March. Good Friday isn’t a federal holiday. See: When do markets close for Good Friday?
While the phenomenon of Good Friday coinciding with the payrolls report might seem unusual, it’s not uncommon.
Since 1980, there have been 11 occasions when the March jobs report was released on Good Friday, with the two most recent instances in 2012 and 2010, according to the Bureau of Labor Statistics.
|Previous instances when the nonfarm payrolls report was released on Good Friday|
|2015 (scheduled)||April 3|
The jobs report is one of the most important economic indicators that investors follow to asses the health of the economy.
However, over the past 12 months, market reaction to surprises—positive or negative—has been somewhat muted. The S&P 500 moved on average roughly 0.6% in either direction on jobs day, with only three instances when the market moved more than 1%.
“The reason the reaction had been so muted is due to the Federal Reserve’s transparency about its policy decisions,” said Colin Cieszynski, chief market strategist at CMC Markets.
“The Fed made it clear how it would proceed with the rate hikes as labor market improves and whether it happens in June or July or September does not make much difference,” Cieszynski said.
Federal Reserve Chairwoman Janet Yellen indicated in remarks Friday that a rate hike is likely on the way soon, but that the pace of subsequent hikes would probably be gradual.
Recent jobs numbers have signaled decent growth but have been far from pointing to an overheating labor market. The average number of monthly payroll gains over the past 12 months has been 266,000.
The consensus forecast for the March jobs gains is 255,000, while the unemployment rate is expected to remain at 5.5%.
Cieszynski said that a number too much higher than the consensus forecast is likely to hit the markets, as it would imply the rate hikes are coming sooner rather than later.
“Anything that is more or less in line with expectations will allow the stock market rally and catch up with other indexes, such as DAX or Nikkei 225. But at this point, the inflation number is more important for the Fed,” he said.
Investors might get a brief glimpse of market reaction from stock-index futures, which will be open for trade for 45 minutes after the release, closing at 9:15 a.m. Eastern.